Which consumption tax was first introduced in France in 1954 by tax official Maurice Lauré?

France introduced value-added tax in 1954 under the direction of Maurice Lauré, making it the first country to implement a modern VAT.

VAT is charged at successive stages of production and distribution. Businesses generally collect tax on their sales while receiving credit for VAT paid on their purchases, so the tax ultimately falls mainly on final consumption.

The system was designed to avoid the cascading problem of a turnover tax, in which tax can be charged repeatedly on the same value as goods move through the supply chain. France’s model later spread across Europe and much of the world.

VAT is often confused with a retail sales tax. A retail sales tax is normally collected only at the final sale, whereas VAT is documented and collected throughout the supply chain.