Under the EU system of VAT, where a person carrying on an economic activity supplies goods and services to another person, and the value of the supplies passes financial limits, the supplier is required to register with the local taxation authorities and charge its customers, and account to the local taxation authority for VAT (although the price may be "inclusive" of VAT, so VAT is included as part of the agreed price, or "exclusive" of VAT, so VAT is payable in addition to the agreed price).