VAT is not unfair (or a Tariff)

A simplified analysis illustrates why EU Value Added Tax, VAT, should not be considered an unfair trade barrier (or a Tariff.)

Assume that investors in businesses require a similar return after taxes regardless of the country. A reasonable simple assumption given that investors can invest wherever they want.

Assume similar manufacturing cost. Not always true but not relevant to analysis.

Chart shows that a VAT treats EU producers similar to importers of US cars. Both pay a VAT which is passed on to consumers. VAT is just how EU pays for it large social benefits systems.

Chart also shows that US consumers are treated similarly whether they buy domestically or buy an import. While there are unfair trade practice, non-tariff trade barriers and even higher tariffs on US products being imported to Germany than the tariffs on German products being imported into the US, the VAT the EU uses to raise revenues does treat US imports to EU unfairly.

https://x.com/OptimistcSkeptc/status/1909328773717045759