Add VAT
Total = pre-VAT price x (1 + VAT rate/100). VAT amount = total - pre-VAT price. For example, at 20% VAT: $100 x 1.20 = $120 total, $20 VAT amount.
Remove VAT
Pre-VAT price = VAT-inclusive price / (1 + VAT rate/100). VAT amount = VAT-inclusive price - pre-VAT price. For example, £120 at 20%: 120 / 1.20 = £100 pre-VAT, £20 VAT.
Frequently Asked Questions
VAT (Value Added Tax) is a consumption tax applied at each stage of production and sale, with the final cost borne by the consumer. Unlike US sales tax which is added only at the point of retail sale, VAT is collected incrementally throughout the supply chain. VAT is used in over 160 countries and is the most common form of consumption tax globally.
Standard VAT rates vary: European Union countries typically have 17-27% (UK 20%, Germany 19%, France 20%, Hungary 27%); Australia GST 10%; Canada GST 5% plus provincial taxes; Mexico 16%; Japan 10%; New Zealand GST 15%. Many countries also have reduced rates for essentials like food and medicine.
VAT is included in the displayed price; the consumer pays the VAT-inclusive price and the seller remits the VAT to the government. US sales tax is added on top of the displayed price at checkout. Both are consumption taxes paid ultimately by the consumer, but their calculation and administration differ significantly.
Divide the VAT-inclusive price by (1 + VAT rate/100). For example, to find the pre-VAT price from a £120 price at 20% VAT: 120 / 1.20 = £100. The VAT amount is the difference: £120 - £100 = £20. Use the Remove VAT mode in this calculator.
GST (Goods and Services Tax), used in countries like Australia, Canada, India, and New Zealand, operates similarly to VAT — both are multi-stage consumption taxes. In practice, the terms are sometimes used interchangeably. The calculation method for adding or removing GST/VAT is the same.
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