I know it's how it works in Portugal and I wouldn't be surprised if it was because of some EU tax directive that it's like that. There are some exceptions, ofcourse.
That's surprising! So say I buy a bunch of produce from a farmer for my shop in Portugal. In the case where I sell it I'd expect to pay VAT on my margin. But how would my accounting differ between putting it in trash bags and putting it in a box labeled "free"?