Many countries (including Canada and certain European countries) employ Value Added Taxes (VAT) as important revenue sources. Value added taxes are applied at each level of the manufacturing and other economic processes and the sum of the taxes is reflected in the final price of goods and services. While generally such taxes are applied only by a national government, in federal states there may be a national tax and a provincial or state tax. Canada has a national VAT (Goods and Services Tax – GST) and Canadian provinces have their own VATs (Provincial Sales Tax – PST).
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