No tax is ever implemented in a manner which is perfectly responsive to the logical implications of its basic purpose. VAT is no exception.
Those who foster this tax basically intend that ultimate tax incidence be suffered only by individuals and then only in the degree to which they dip into society's pool of consumer-type goods and services. But their implementing legislation is always designed to fall short of reaching all consumer-type goods and services. Ullman's proposed Tax Restructuring Act of 1979 would have been no exception. Under it, a substantial proportion of all such benefits actually would have been excluded.
L. H. Wright,
Personal, Living or Family Matters and the Value Added Tax,
Mich. L. Rev.
Available at: https://repository.law.umich.edu/mlr/vol82/iss3/9