Under the flat rate scheme this is the CHRL: 1 Under the standard rate scheme these are NHIL: 2.5, GETFL: 2.5 and CHRL:1.

Flat rate scheme: 3 Additional levies are charged on taxable supplies. This in turn allows VAT statutory rates to be much lower than those of ordinary sales taxes, raising the same amount of revenue more efficiently.Azerbaijan (Last reviewed 18 August 2021)īosnia and Herzegovina (Last reviewed 25 February 2021)īotswana (Last reviewed 12 February 2021)įederal VAT (IPI): normally around 10% to 15% State sales and service tax (ICMS): normally around 18% to 20% (lower rates apply to inter-state transactions).Ĭabo Verde (Last reviewed 26 August 2021)Ĭameroon, Republic of (Last reviewed 03 August 2021)Ĭombined federal and provincial/territorial sales taxes range from 5% to 15%.Ĭayman Islands (Last reviewed 03 August 2021)Ĭhina, People's Republic of (Last reviewed 25 June 2021)ġ3, 9, or 6 depending on the types of goods and servicesĬongo, Democratic Republic of the (Last reviewed 20 July 2021)Ĭongo, Republic of (Last reviewed 18 August 2021)Ĭosta Rica (Last reviewed 24 August 2021)Ĭzech Republic (Last reviewed 08 July 2021)ĭominican Republic (Last reviewed 20 July 2021)Įquatorial Guinea (Last reviewed 20 July 2021)ġ9 (the standard rate was reduced to 16% for the period 1 July 2020 until 31 December 2020 in response to the COVID-19 pandemic)

The total tax paid is $15, or 10% of the final retail price.Īdvocates of VATs say this structure reduces evasion because it’s harder for three entities to avoid paying a $15 tax than it is for one. The retailer sells the finished table to a customer for $150, sending $3 to the government ($150 – $120 = $30 X 10% = $3). The furniture maker sells the table to the retailer for $120, sending $7 ($120 – $50 = $70 X 10% = $7) to the government. The lumber company sells the wood to the furniture maker for $50, paying $5 (10% of $50) to the government. A VAT is similar to a sales tax, except that it is paid incrementally at all levels of production, on only the value added at each level, to prevent pyramiding and eliminating the need to separate business inputs from retail sales.įor example, take a wooden table sold at retail and a 10 percent VAT rate.

Value added tax examples