- Aug 2014
The VAT was paid on the car when it was new*. That VAT forms part of the total price, which is depreciated as it ages. So you DO pay VAT on used goods, but only a depreciated portion of the original tax, and it goes to the vendor rather than the government. The only way to avoid it is if the tax somehow gets refunded before the rest of its cost is depreciated.It works that way, only that the example is reductive: You don't pay VAT on a used car. I don't pay a VAT on my used car either: I've just bought myself a 1963 Ferrari 250 GTO, costed me just some dozens of millions...
* your particular example is an exception because it was first sold in 1963, which was before the introduction of VAT.