this post was submitted on 10 Sep 2024
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Just a reminder that the USSR had a VAT as its main tax revenue for almost its entire existence.
China and Vietnam still has a VAT tax system based off of the Soviet system as well
Yeah, a rare Soviet L, i guess there were troubles in tax collection during NEP, since iirc it was implemented around that point. Still, the context of this tax in socialism and capitalism is kinda different, right now indirect taxes in general are main part of overall regressive tax system (like in Poland poor people pay total around 60% tax, rich one 20-30% and richest who know how much, probably even less). And Poland for example did not had VAT in socialism.
The reason for the VAT (in the USSR it was called a Turnover Tax. They're the same thing but a VAT does not tax means of production) was how incredibly simple it was to administer. Tax fraud could be kept relatively low for any given level of administration if a VAT was used instead of an income tax, for example. Many modern governments do this today for the same reason.
The USSR was constantly in a struggle to build an effective administration (a good book on this is Origins of the Great Purges ) while fighting what we today would call Bullshit Jobs and local strongmen.
Yeah