value-added tax


Definition of value-added tax

: an incremental excise that is levied on the value added at each stage of the processing of a raw material or the production and distribution of a commodity and that typically has the impact of a sales tax on the ultimate consumer

Examples of value-added tax in a Sentence

Recent Examples on the Web Under the region’s customs union, imports of pasta face a tariff of 20% and also value-added tax of 15%. The Economist, 15 Mar. 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'value-added tax.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

First Known Use of value-added tax

1935, in the meaning defined above

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The first known use of value-added tax was in 1935

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Cite this Entry

“Value-added tax.” Dictionary, Merriam-Webster, Accessed 25 Sep. 2021.

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More Definitions for value-added tax

value-added tax


English Language Learners Definition of value-added tax

: a tax that is added to products at each stage of their production

value-added tax

value-ad·​ded tax

Legal Definition of value-added tax

: a tax levied at each addition of value in the processing of a raw material, the performance of a service, or the production and distribution of a commodity with each payer except the consumer reimbursed from payment at the next stage

called also VAT

More from Merriam-Webster on value-added tax

Thesaurus: All synonyms and antonyms for value-added tax Encyclopedia article about value-added tax


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