VATupdate Newsletter Week 48 2024

HAMBURGER

A reverse charge applies to certain transactions, in which case the customer must self-assess for VAT.

For many people, this sentence does not make any sense. What is a reverse charge? What does self-assessment mean? For us, VAT people, this terminology may not be difficult, but for outsiders, it is abracadabra.

As VAT specialists, we live in our own cosy bubble. We deal with transactions and businesses, and as such, we meet many different people. All of them speak their own language and use their own jargon or ‘slang’. Try explaining VAT to a commercial or logistics person, and you’ll probably see those glassy eyes that are so familiar to anyone who’s ever tried talking about VAT outside our circle.

That’s why we must continue trying to make VAT more accessible. For example, by highlighting (even more) that VAT can be fun. I’ll give you an example you can use to ‘break the ice’ with your colleagues or friends.

Do you know where the word ‘hamburger’ comes from? I don’t know either, but isn’t it strange that there is no ham in a hamburger? The Oxford English Dictionary defines a hamburger as “a flat, round cake of minced beef, fried or grilled and typically served in a bread roll garnished with various condiments.” One thing that generally doesn’t make the ingredients list? Ham.

There is an obvious explanation, which is the origin of the product: Hamburg, Germany. The burger as we know it today evolved from Hamburg steaks. The name of the German dish was shortened to “Hamburgs” and then, when the beef was eventually sandwiched between two slices of bread, to “hamburgers.” The ham in hamburger thus refers to the origin, not to the ingredients.

What does this have to do with VAT? The origin of VAT does not go back to the name of a city or person. In this case, the word does come from its ingredients: the added value in a supply chain. What it does have in common with the hamburger, though, is that both are mentioned on the menu of almost every restaurant or fast food chain out there.

And here’s the kicker: just like there’s no ham in a hamburger, there’s no visible VAT in most transactions—it’s silently baked in. Yet somehow, it manages to give everyone indigestion!

But don’t worry, next time you’re explaining reverse charges and self-assessment, just smile and remember: if people can accept that hamburgers have no ham, maybe they’ll eventually accept that VAT is just as puzzling—but equally unavoidable. Bon appétit!

Stay tuned to VATupdate for more insights, laughs, and updates from the ever-evolving world of VAT!

If you have any comments, questions, or ideas that you want to share with us, please send us an email at [email protected] or leave a comment under the posts of this newsletter on LinkedIn.

To go directly to the region, click below: