Thomson Reuters Survey Shows Businesses Oppose VAT
Thomson Reuters Survey Shows Businesses Oppose VAT
- Institutional AuthorsThomson Reuters
- Subject Area/Tax Topics
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 2010-17418
- Tax Analysts Electronic Citation2010 TNT 150-39
- Magazine CitationThe Insurance Tax Review, Oct. 1, 2010, p. 82339 Ins. Tax Rev. 823 (Oct. 1, 2010)
Majority of American businesses are against VAT
New York, August 4, 2010 -- The Tax & Accounting business of Thomson Reuters today announced findings from a recent Sabrix survey on the impact a value added tax (VAT) would have on American businesses. The majority of executives polled are against VAT and agree that it would significantly increase the cost of compliance.
The survey conducted in June and July of 2010 polled 80 tax executives within various business sectors. Their responses indicate the following:
83.5 percent believe that a VAT would significantly increase the cost of compliance
76.3 percent are against a VAT policy in the United States
67.1 percent of businesses currently do not have any infrastructure (technology, people or processes) in place to comply with VAT in the United States
16.5 percent currently have in-house expertise to comply with VAT in the United States
82.1 percent of businesses need six months to two plus years to prepare for VAT in the United States
51.3 percent believe the streamlined sales tax (SST) initiative has a better chance of success than VAT in the United States
VAT is a tax on the estimated market value added to a product or material at each stage of the manufacturing or distribution process, which is ultimately passed on to the consumer. Like a sales tax, businesses will be burdened with collecting the tax on behalf of the government.
"For affected businesses, achieving compliance with a new VAT would require considerable time, money and effort," said Carla Yrjanson, vice president of Tax Research and Content for Indirect Tax, Thomson Reuters. "For example, in 2008 a simple VAT rate reduction in the United Kingdom (U.K.) was estimated to cost businesses $465 million over two years. Now multiply that amount by initial infrastructure costs as well as an overall economy that is roughly six times that of the U.K. economy and you can get a sense for just how much it will cost American businesses."
For more information about Sabrix, Thomson Reuters go to http://www.sabrix.com
About Thomson Reuters
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- Institutional AuthorsThomson Reuters
- Subject Area/Tax Topics
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 2010-17418
- Tax Analysts Electronic Citation2010 TNT 150-39
- Magazine CitationThe Insurance Tax Review, Oct. 1, 2010, p. 82339 Ins. Tax Rev. 823 (Oct. 1, 2010)