it is regressive, it impacts small earners more than rich people, since a larger share of their income goes into direct consumption.
But many countries have different VAT brackets for different goods, e.g. in Italy at different times (I'm not sure of the current brackets) "staple" goods like bread or milk had 4% VAT, health and education had 5%, fish or meat had 10%, generic services have 22% and at some point "luxury" goods had 30%+ vat.
But many countries have different VAT brackets for different goods, e.g. in Italy at different times (I'm not sure of the current brackets) "staple" goods like bread or milk had 4% VAT, health and education had 5%, fish or meat had 10%, generic services have 22% and at some point "luxury" goods had 30%+ vat.
This offsets the regressiveness somewhat.