Preferred Terms


Value added tax

Abbrev:

Synonym Terms:

Definition:

A sales-tax on products collected in stages by enterprises.
It is a wide-ranging tax usually designed to cover most or all goods and services, including pharmaceutical products. The VAT rate of pharmaceuticals in the EU is often lower than the standard VAT rate.
Deductible VAT is the value added tax payable on purchases of goods and services intended for intermediate consumption, gross fixed capital formation or for resale which producers are permitted to deduct from their own VAT liability to the government in respect of VAT invoiced to their customers.
Non-deductible VAT is the value added tax payable by purchasers that is not deductible from their own VAT liability, if any.