How does a value-added tax differ from a sales tax?

A value- added tax (VAT) occurs multiply times throughout a product’s or service’s supply chain. Unlike a sales tax which is imposed on the end buyer, whenever goods or supplies change hands a tax is placed on the value added by each party at every stage of production or distribution; cost of goods sold minus sales is taxed at a certain percentages.

There are multiply counties in Asia with a VAT system in place; the percentage of the tax varies by country and region.
Countries that have VAT systems:

• China
• India
• Laos
• Philippines
• Thailand
• Vietnam
• Singapore