*The Commerce Journal>>>Germany Taxes

Can anyone explain, in layman's terms, the VAT tax in Germany or another comparable EU state?

VAT is basically value added tax, similar to what sales tax is in the US or goods and services tax (or GST) is in Canada or Australia except that the price that you see usually already includes the tax. In most cases, what you see is what you pay so you don't have to do any further math.

This is an indirect tax meaning it is passed on from the merchant to the consumer who pays the tax on the good.

Since you mentioned Germany, VAT is known there as Mehrwertsteuer (MWST). Spain's VAT is IVA.

VAT is high in the EU, usually more than 15%. But if you are a non-EU resident you may get a VAT refund on goods you intend to take home with you. To do so, look for a store which says Global Refund or Tax Refund or something like that and don't forget to obtain a refund voucher. Present this voucher along with the item/s to Customs at your port of departure from the EU. Source(s): I just came from a 2nd trip to Europe although I didn't take advantage of this.

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