### 2.3 Consumption Taxes

<
>
• Math Help

For the spreadsheet in Example 5(b), be sure you see that the 10% tax at each stage is only for the value-added and not for the new value at that stage.

After all, that is the whole point of a "value-added" tax ― to tax only the value that is added at that stage of production.

• Consumer Suggestion

About 150 countries have a value-added tax (VAT), ranging from 5% in Japan to 25% in Sweden. Before traveling to a foreign country, you might want to find out what the VAT is before purchasing goods. You can find a list of VAT by country here.

• Checkpoint Solution
1. If the sales tax rate is 8%, then the sales tax is

Notice that in both cases, the total tax is \$31.60.

These comments are not screened before publication. Constructive debate about the information on this page is welcome, but personal attacks are not. Please do not post comments that are commercial in nature or that violate copyright. Comments that we regard as obscene, defamatory, or intended to incite violence will be removed. If you find a comment offensive, you may flag it.

``` _    _     ______   __   _      ___      ____
| |  | ||  /_   _// | || | ||   / _ \\   |  _ \\
| |/\| ||   -| ||-  | '--' ||  | / \ ||  | |_| ||
|  /\  ||   _| ||_  | .--. ||  | \_/ ||  | .  //
|_// \_||  /_____// |_|| |_||   \___//   |_|\_\\
`-`   `-`  `-----`  `-`  `-`    `---`    `-` --`

```