Bob the Farmer grows vegetables at his farm in South Dakota. He grows his vegetables for sale to food companies. On November 1, he sells his vegetables to Grannys Pie Company for $65,000, inclusive of 13% VAT. Grannys Pie Company uses his vegetables to produce savory meat and vegetable pies (theyre huge in the UK). After the production of the pies is complete, Grannys Pie Company sells the pies to Winn Dixie Grocery Stores for $140,000, inclusive of 13% VAT. Winn Dixie Grocery Stores subsequently sell all of the pies to consumers for $200,000, inclusive of 13% VAT. Assume that meat and vegetable pies are not subject to VAT exemptions (the government has deemed them not essential).

a) How much VAT is remitted to the government in total?

b) How much VAT is remitted to the government at each stage in the production process, and by whom? 4 points Advanced Taxation Spring 2020 c) How much net tax burden is economically borne by each participant in the production process/supply chain?