[manmal]

It’s not really a tax on their profits. Consumers have to pay it on top of the net sales price, and they know that it won’t add to the company‘s bottom line. The money goes to the state every month (or quarter sometimes), deducted by the VAT the business itself already paid for services/products.

For accounting purposes, VAT is a totally separate cycle of money, and for every important financial metric, VAT is ignored. [Removed] If you happen to spend more VAT than you collect, you’ll get the negative back from the state. Also, the net price is always known because it must be shown on every invoice.