Sales tax and VAT formulas
Price with tax = price before tax × (1 + rate ÷ 100)
Price before tax = price with tax ÷ (1 + rate ÷ 100)
Tax = price with tax − price before tax
Example: removing 25% Swedish VAT
An item costs 1,000 kr including 25% VAT. The price before VAT is 1,000 ÷ 1.25 = 800 kr, so the VAT is 200 kr. A common mistake is to take 25% of 1,000 kr (250 kr), which is wrong because the VAT was calculated on 800 kr, not 1,000 kr.
Standard VAT and GST rates
| Country | Standard rate |
|---|---|
| United Kingdom | 20% |
| Germany | 19% |
| France | 20% |
| Sweden | 25% |
| Australia (GST) | 10% |
| Canada (GST, before provincial tax) | 5% |
| India (most common GST slab) | 18% |
Rates change and many countries have reduced rates for food, books and other goods. Check your local tax authority for the rate that applies.