The victim of the VAT tax is the final consumer, rich or poor. From producers to retailers VAT is paid on the mark-up portion of the price. The more “middle men” in the marketing process, the more taxes will be paid by the final consumer.
There is no social benefits in the VAT. VAT is on Goods and Services. VAT is a tax on taxes. In conclusion the VAT is the major cause of fiscal fraud (cash payment, undeclared work, barter, double-invoicing, etc…).
VAT has been the cause of unemployment and social security deficit.