The Consumption Tax

Consumption tax is a tax levied on goods and services at the point of purchase. It is typically included in the price you pay, making the final amount higher. The purpose is to generate revenue for government programs. Unlike income tax, which depends on how much you earn, consumption tax depends on your spending. Common examples include sales tax or value-added tax (VAT). It affects everyone who buys goods or services, encouraging consumers and businesses to consider costs, while providing governments with funding for public services.