the term "defence" is cited 82 times, in 62 pages
This is the great European "New Deal", what a genius
He'll be dead by the time we'll realize the effect of this 'great' move.
Much much better the arc of St. Luis ;)
This is the great European "New Deal", what a genius
He'll be dead by the time we'll realize the effect of this 'great' move.
Much much better the arc of St. Luis ;)
By the way, most of the "defence" industry in Italy did not pay VAT till last year where they had to align to EU directives (well, they may still not pay VAT for supply to arm force)... I have no doubt lobbiest worked a lot on convincing leaders to create jobs by manufactoring guns.
VAT is a tax levied on consumers, not companies/industries. Companies get it from consumers and forward it to the government, that's an optimization of enforcement, it doesn't mean companies pay it out of their pockets. Government pays companies back whatever VAT they paid on stuff they bought. It would make no sense for the government to pay VAT to itself when buying such expensive stuff; this is again a process optimization, not some fundamental change of how the tax works.
Why would you need lobbyists when you have Putin just behind the door?
I've got it, but you agree with me that is weird that when the State buys from the private market they do have to pay VAT (even to themselves) while when that market is "defense" it may not happen?
Then, of course, If I produce pistol (as a company), and buy metal, and make a pistol, don't I end up paying VAT on the "added value" ? in other way, even if a company sell to other companies, the VAT% (10% or 90%) does or does not affect profitability?
Then of course you sure have some percentage of buyers who cannot claim VAT (is it small, only consumers? what about not perfectly legal business.... )
> Then, of course, If I produce pistol (as a company), and buy metal, and make a pistol, don't I end up paying VAT on the "added value" ? in other way, even if a company sell to other companies, the VAT% (10% or 90%) does or does not affect profitability?
No, profitability is not affected in any way. The consumer always pays, not any company in the chain of raw material to consumer product. VAT is irrelevant to them, it's just some bureaucracy that needs to be taken care of, but nothing else. It could be 110% and they wouldn't care - VAT is separately on top of the invoiced price and you never treat it as your money, you're just holding it for the government for up to 30 days.
> Then of course you sure have some percentage of buyers who cannot claim VAT (is it small, only consumers? what about not perfectly legal business.... )
Any business can claim VAT back if they choose to. Some countries allow small businesses to say "I don't care, don't bother me, I will eat the difference". This results in losses to the small business, it's done because the paperwork is really hard to do - takes a lot of time and money (you need an expensive tax advisor in many everyday cases). The usual limit of this is around 50k USD of yearly revenue. Above that, it's necessary to fill the VAT forms.
Well, anyhow, let me say that, since it makes no difference for them (apart from the burden of VAT accounting), I would let them pay VAT as every other sector and that's it :)
One last doubt:
* when in the national accounting a State report to have spent 1M for goods for education, in that million they do include VAT (I've just found out, I did not know it before), so the VAT% of that spending was money that "went back" to the State (to us).
* when in the same accounting they report to have spent 1M in guns (a vat exempt sector), that VAT% benefit for us is gone: am I right?
Accounts of businesses and governments are without VAT except for the most generalized cash flow tables. My own government reports both numbers (with and without VAT) in cases where this matters. I'm quite surprised yours doesn't do this. But yes, you're right - in your situation the actually spent amount would be different by the VAT rate.
ah, interesting.
no VAT in the UK https://www.gov.uk/government/publications/how-public-spendi... (well, it's the first link I found... even in the excel file no vat mention..... I am sure I can find mention to it, I did not search much
No vat for Italy, too (just a quick search), even for the defence https://temi.camera.it/leg19DIL/temi/19_il-bilancio-della-di...
which one? if you don't want to tell I understand of course
then this https://blogs.plymouth.ac.uk/dcss/2015/11/16/vat-exemption-f...
"One Member State has for example recently submitted an order of about 1.3 million Euros for one year of services. Due to the VAT exemption, this Member State will not have to pay VAT for a corresponding value of 273 thousand Euros which represents about three months of free services."
This is also interesting https://meta-defense.fr/en/2022/02/16/the-european-commissio...
"The European Commission, and its Commissioner Thierry Breton in charge of industrial issues, has therefore taken up the problem once again, and has proposed several measures to try to favor "made in Europe" in terms of defense equipment contracts. within the Union. Thereby, it proposes to abolish VAT for European programs, so as to put European proposals on the same level as those coming from the American FMS, which is also systematically exempt from VAT".
so, exempting VAT for the Defence will push the "made in Europe"... why not do it in another sector?
then https://sede.agenciatributaria.gob.es/Sede/en_gb/todas-notic...
"In this way, deliveries, imports and intra-community acquisitions of goods made by the aforementioned armed forces, for their use or that of the civilian personnel in their service, as well as for the supply of their dining rooms or canteens, are declared exempt."
Does the VAT extemp (which is far more popular as I thougt and not limited to Italy) for the "defence" sector benefit the defence industries even when a State is the buyer?
I get it they do it "for us", but we come to the main point: using weapon manufactoring to raise economy..... why that and not anything else which spread less shit?
a big saving to be part of NATO, eh?
yes, you are right
add also many others who accuse you to be Putin's friend if you care about peace