frosthowler

frosthowler t1_j1y3qgj wrote

The idea in principle is that with or without VAT, the business would have charged about $X for their product.

Which is a very simplistic few of the whole thing. There are plenty of countries with so many import taxes, VAT, etc, that goods are very clearly overpriced and would not be so pricey without all of that, because of undercutting. The price stabilizes usually at a point that grants profit leading to a 'desirable' level of growth.

With a monopoly, or in sectors where a coordinated effort to stabilize the price at a profitable range is possible, then removing the taxes imo is useless. There is no point in removing taxes on transactions like cars, in my opinion.

But basic foods? There is no way to price fix that. The price you see is the lowest price possible at current conditions, usually. I think Spain is absolutely in the right of this line of thinking.

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