Value Added Tax And Implementing China Essay - 2371 Words

ACCT 498-Capstone paper Qiming Wang 9/11/2016 Value Added Tax and Implementation in China Introduction As a type of consumption tax, as of January 1 2014, 164 countries employ a Value-added Tax in the world. All Organization for Economic Co-operation and Development (OECD) members except the United States now applied VAT. According to the research by OECD committee, consumption tax was a large source of tax revenues, and â€Å"the VAT accounted on average for 6.6% of GDP and 19.5% in total tax revenues in OECD countries in 2012,† which was the largest proportion (â€Å"Consumption tax trends 2014†). To become familiar with the performance and importance of the VAT, leaning the meaning and implementation of VAT in a specific country would be a effective way to know why VAT developed rapidly in the worldwide in contemporary society. Brief History of Value Added Tax A value-added tax is a type of consumption tax that is placed on a product whenever value is added at a stage of production and at final sale. The value added tax applies to all economic activities involving the production and distribution of goods and the provision of services. According to European Commission’s definition, Value Added Tax is a general based consumption tax charged on the value added to each stage of goods and services (â€Å"What is VAT?†). The idea of Value-added Tax was introduced by Dr. Wilhelm von Siemens, a German industrialist who proposed the concept of the VAT. The key concept of Von Siemens’s idea wasShow MoreRelatedChin The World s Largest Producer Of Coke816 Words   |  4 PagesCoke Industry China is the world’s largest producer of coke, and there is evidence that China has for the last decade manipulated production and prices. 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