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Finance: What is VAT? 5 Views


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Description:

What is VAT, or value added tax? Hit play to find out.

Language:
English Language

Transcript

00:00

finance a la shmoop what is the eighty or VAT well it's this what okay then I

00:09

never mind Breaking Bad was awesome though anyway in finance land VAT or V.A.T[Car drives by financeland sign]

00:14

stands for value-added tax and it is simply a consumption tax like the tax

00:21

rate on anything you buy in Massachusetts is say ten percent so you

00:25

think that car cost thirty grand no it was thirty three grand and you'll pay [Car on a driveway]

00:31

other v.a.t.s like a tax for your license plate registration and other

00:35

stuff note that the V and the A in their value-added yeah and it's a fair

00:41

question to ask value-added for whom and the answer is the government the taxman [Uncle Sam poster appears on wall]

00:46

v80 tax is that three dollar gallon of gas at the same rate for Bill Gates as

00:51

it does for Joe Sixpack it is a regressive tax that is rich in poor

00:57

people all pay the same rate and yes Bill Gates jet probably uses more gas [Bill Gates stood by a jet]

01:02

than does Joe six-packs but the rate per gallon is the same and this causes

01:07

controversy among various political factions who feel that it's wrong to tax [Political figures speaking on stage]

01:12

the poor at the same rate as the rich well when it comes to income tax the

01:17

rich are taxed vastly more not just in volumes of dollars taxed because they

01:22

earn more money but in the rate of tax applied like let's punish those

01:27

hard-working plumbing parts suppliers and reward the guy who's asleep at the [People using laptop on benches]

01:32

tollgate taking the five bucks like someone in a blue state making thirty

01:36

grand a year pays fifteen percent tax on their last dollar someone making 500

01:41

grand pays like fifty cents or half so over time a number of politicians have

01:45

suggested that v80 should somehow have an income level overlay that is the

01:51

buyer of a given gallon of gas should state what income tax bracket they're in [Man unscrewing gas knob]

01:56

when they go to the gas pump and that for Bill Gates that gallon should cost [Gas pump filling up car]

02:00

like thirty eight dollars whereas for the Union Tollbooth worker yeah wake up

02:04

there buddy five bucks each time well they only have to pay two dollars for

02:08

their gallon of gas fair not fair well ask the toll booth guy

02:12

you know when he wakes up [Toll both man sleeping]

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