Replying to @kymchan What is VAT? VAT means Value Added Tax. It is a tax added to the price of goods and services. Why do we pay VAT? VAT is collected by businesses and sent to the government to help pay for public services. How is VAT calculated? VAT is a percentage of the original price. You multiply the price by the VAT rate to find the tax amount. Example: If VAT is 12.5 percent and the item costs 100 dollars: VAT = 100 × 12.5 percent What is the final price? Final price = original price VAT