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Glossary Finance

VAT (value-added tax)

VAT is a consumption tax added to the price of goods and services at each stage of production, ultimately paid by the final consumer.

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In more detail

To add VAT multiply by 1 + rate; to remove it divide by 1 + rate. $120 including 20% VAT is $100 net plus $20 VAT. The rate varies by country and by product.

Try these tools

VAT Calculator

Calculate Value Added Tax (VAT) -- add VAT to a net price to get the gross price.

See also

  • Glossary Sales tax
    Sales tax is a percentage added to the price of goods at the point of sale, collected by the seller and passed to the government.
  • Cheat sheet Finance Formulas Cheat Sheet
    The interest, loan, investing and everyday-money formulas behind our calculators.
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