A cascade tax or cascading tax is a turnover tax that is applied at every stage in the

supply chain In commerce, a supply chain is a network of facilities that procure raw materials, transform them into intermediate goods and then final products to customers through a distribution system. It refers to the network of organizations, people, acti ...

, without any deduction for the tax paid at earlier stages. Such taxes are distorting in that they create an artificial incentive for vertical integration.G.R. Putland,
Critique of the Debits Tax and Turnover Tax
, '' Prosper Australia''; retrieved Nov.9, 2009. They have been replaced in Europe and many other locations by a value-added tax.

References

Sales taxes {{tax-stub