Compare and contrast a general retail sales tax with a value added tax

Compare and contrast a general retail sales tax with a value added tax.

What will be an ideal response?

ANSWER

Both taxes have the same tax base. A general retail sales tax is easier to compute, requires less monitoring by the government, is more transparent to taxpayers, and imposes a taxpaying burden of fewer individuals/organizations. A value added tax, on the other hand, makes it easier to avoid double taxation by not requiring wholesale sales to be differentiated from retail sales.