>either you don't pay it when you purchase and are invoiced by a business
As a business you pay VAT when you purchase. And you collect VAT when you sell.
Then you pay to the government the difference between collected VAT and paid VAT.
That's what the "Value Added" part means.
As a business you pay VAT when you purchase. And you collect VAT when you sell. Then you pay to the government the difference between collected VAT and paid VAT. That's what the "Value Added" part means.