What is VAT?

VAT or Value Added Tax is a form of consumption tax. From the perspective of the buyer, it is a tax on the purchase price. Tax is charged on most goods and services supplied by VAT registered businesses in the United Kingdom (UK). The current standard VAT rate in the UK is 20 per cent. All 28 European countries have VAT. It has different names in different countries eg. In France it is TVA, Spain – IVA, Germany – Mwst, etc. Each country also applies its own VAT rate.