Have you ever wondered how VAT (Value-Added Tax) is calculated? It’s simpler than it seems! First, you need to know the tax rate in your region. For example, let's assume the VAT rate is 10%. When calculating VAT, multiply the price of the product or service by the tax rate.

For instance, if an item costs $50, the VAT would be $50 × 10% = $5. The final price you pay will then be $50 + $5 = $55. Simple, right? 😎

Remember, VAT is applied at each stage of production and distribution. Businesses collect this tax from customers and later pass it on to the government. It ensures fairness since only the value added at each stage is taxed.

Understanding VAT helps you make informed decisions while shopping. Plus, knowing how taxes work empowers you as a consumer! 💡✨