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English definition of “VAT”

VAT

noun [U]     /ˌviːeɪˈtiː/ TAX
abbreviation for Value Added Tax: a tax that is paid at each stage in the production of goods or services, and by the final customer. Businesses in the production process take away the cost of inputs (= labour, materials, etc.) from the cost of outputs (= products and services sold) to calculate the amount that they must pay: You can pay as little as £600 plus VAT for a powerful PC.including/excluding VAT The price is £19.99, including VAT. Those with a turnover of £51,000 or more have to register for VAT. Banking services are exempt from VAT.
(Definition of VAT noun from the Cambridge Business English Dictionary © Cambridge University Press)
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