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VAT Comes of Age

Niall Campbell Partner-in-Charge of KPMG's Global Indirect Tax Practice and Gary Harley Head of Indirect Tax at KPMG in the UK explain why indirect tax is becoming increasingly important to business
As global competition for investment puts pressure on national governments to reduce headline corporate income tax rates they must find alternative sources of tax revenue. VAT/GST is a particularly attractive alternative for governments as it is a very efficient means of collecting revenue without negatively impacting on the attractiveness of the jurisdiction as an investment location. The burden of collection falls predominantly on domestic suppliers of goods and services and the tax is ultimately borne by local consumers who are not as mobile as corporates and are thus less capable of deflecting the tax liabilities.
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