Quote:
Originally Posted by AMERICA 123
Don't forget they pick up a 10% VAT subsidy coming out of Korea
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Please don't confuse the Tax System used by Asia and the rest of the world, with the Tax System used in the US...
The VAT rebate is
not a subsidy. In the US, sales tax is collected at time of
sales, from the
purchaser. With cars, it is usually collected when you register the car...
VAT on the other hand is collected from the
manufacturer at time of
manufacture. When such a product is exported, it will not be "consumed" in the domestic market, therefore the VAT is
refunded back to the manufacturer. This doesn't happen in the US, because our government doesn't collect sales tax from the manufacturer, nor does it collect it at time of manufacture.