that is.           S  =  åA     II ‡    (å denotes “sum total of”’)      

It follows that the total VAT remitted to H.M. Customs & Excise

throughout the supply chain  =  D + D1 + D2 + D3 + ...

  =   å D

but this is the total VAT  T  paid by the consumer

therefore  T  = å D   ........................................................... III

But, because  D   is a tax on A (per I above)

and total VAT  D   remitted by all the suppliers

  =  total VAT T paid by consumers (per III above)

 and this is paid on and in respect of total supply costs å A

where        å A  =  S the supply price (per II above)

then     A + D  =  S + T   =  P

hence  å D is total VAT on å A total net price S and in gross price P

but  å A comprises all the internal costs of each supplier

     (i.e. excluding bought-in items)

and these costs are predominantly labour costs and profits. i.e. effort and enterprise

therefore VAT IS A DIRECT TAX ON LABOUR COSTS        Q.E.D.

In words:

VAT (D) IS REMITTED DIRECT TO H.M. CUSTOMS AND EXCISE BY EACH EMPLOYING ORGANISATION (SUPPLIER) FOR THEIR OWN ADDED VALUE (A) ONLY. IT IS THIS ADDED VALUE (å A) ALONE WHICH MAKES UP THE PRICE (S). But added value costs (å A) are predominantly direct labour costs which are not VAT deductible.

Therefore VAT is a direct tax - i.e. under the discretionary control of the organisation as to how costs are planned - and works as a massive 15% bonus ¶ for shedding; labour in order to compete in the market place.

Therefore, VAT is direct cause of unemployment   Q.E.D.

 

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