Re: Wait a minute
Examples.
A factory exists in a hypothetical country with a VAT rate of 10% and tariff rate of 10%.
The factory imports a machine from the US for use in the factory. Pays a 10% tariff & 10% VAT.
Claims the VAT back, so no VAT ends up being paid by anyone.
They have to pay the tariff, so they increase their prices as their cost of manufacture is higher.
The factory makes toasters. It sells them to a retailer charging 10% VAT. The retailer claims the VAT back.
The retailer also imports toasters from the US. Pays 10% tariff & 10% VAT. Claims the VAT back put pays the tariff. Passes the tariff along in the retail cost of the toaster.
A customer buys 2 toasters. One for home, one for his business. Pays 10% VAT regardless of whether he buys the locally made one, or the imported one.
He claims the VAT back on the toaster for the business, but has to pay it for the one for home.
The factory exports toasters to the US. No VAT is paid.
The US importer pays whatever tariff trump has put in place to US govt customs.
The importer sells the toaster to Walmart passing the tariff along as increased cost.
Walmart also buys toasters from the US manufacturer.
Walmart sells the toasters, charging the same state sales tax regardless of which toaster the customer buys.
The factory exports toasters to a 3rd country. No VAT is paid.
The US manufacturer also exports to the same 3rd country.
Both toasters are subject to the same sales tax regime that exists in that country and whatever tariff regime they have.
In none of these scenarios does VAT give an advantage to the local toaster manufacturer.
It is a consumer sales tax.