- VAT is a complex tax that taxpayers struggle to understand even after attempts at simplification
- Path dependency theory explains how historical choices and structures make VAT reform challenging
- Multiple rates of VAT, including reduced rates and exemptions, are resistant to change and do not benefit consumers
- Special interests and cognitive biases contribute to the entrenchment of complex VAT rules
- Resistance to change from businesses invested in navigating the current VAT system is a barrier to simplification efforts
Source: icaew.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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