🪪 Can you remove the consumption tax from my invoices?

Consumption taxes are a category of taxes levied on the purchase of goods and services. Unlike income taxes, which are based on earnings, or property taxes, which are based on ownership, consumption taxes are imposed when consumers spend money. These taxes are typically indirect, meaning they are collected by businesses at the point of sale and then remitted to the government. The consumer bears the cost of the tax as part of the price they pay for the goods or services.

Common Types of Consumption Taxes

Several types of consumption taxes are used around the world, each with its nuances and applications. The most common forms include:

Value-Added Tax (VAT)

VAT is a tax on the value added to a product at each stage of its production or distribution. It is prevalent in the European Union, parts of Asia, Africa, and many other regions.

Goods and Services Tax (GST)

GST is similar to VAT and is used in countries like Canada, Australia, and India. It is a tax on the supply of goods and services, typically at a national level.

Sales Tax

Sales tax is a direct tax on the sale of goods and services, most commonly used in the United States. Unlike VAT or GST, sales tax is typically charged only at the point of sale to the final consumer.

Exemptions

If your organisation is exempt from paying consumption taxes, such as VAT, GST, or Sales Tax, you should provide us with a valid exemption certificate or other relevant documentation that proves your tax-exempt status. This documentation typically includes an official certificate issued by the tax authority, which specifies the type of exemption and the applicable jurisdiction. Ensure that the certificate is up-to-date and clearly states the reason for the exemption. Sending this information allows us to correctly process your transaction without applying the consumption tax.

Please send your proof of exemption to hello@tixtree.com