Abstract A value-added tax (VAT) is not one tax, but a range of taxes. The particular form it takes depends on the manner of calculation, and the importance of its role in relation to the tax base. This paper identifies the various perspectives of the tax base and the major factors determining a VAT's form. In the discussion of these factors, special consideration is given to the experiences that other countries have had with this type of tax. Calculation models are constructed for the 24 VAT forms defined by these factors. Based on the models, VAT remittance cash flows are simulated for each form, using a sample of 47 large U.S. industrial firms for the period 1975-82. Simulation results suggest that some of the identified factors have a significant effect on VAT remittances.
Robert P. Crum (Sun,) studied this question.