Under a value-added taxing system:
A) Businesses must pay a tax only if they make a profit.
B) The consumer ultimately bears the cost of the tax through higher prices.
C) Consumer savings are discouraged.
D) The amount of value added is the difference between an organization's sales and its cost of goods sold.

Question

Quizplus · Accepted Answer

Under a value-added tax (VAT) system, the tax is added at each stage of production and distribution, but the final consumer ultimately bears the cost as it is included in the purchase price of goods and services.

Under a Value-Added Taxing System