Why can I not just subtract 20 percent to remove 20 percent tax?

Because the tax was 20 percent of the original price, not of the total. Taking 20 percent off 120 gives 96, and the right answer is 100. Removing tax divides by 1.2 rather than subtracting, and this is the single most common error in this arithmetic.

Which countries does this cover?

All of them, because the arithmetic is the same everywhere and only the rate changes. Nothing here assumes a country or a currency, so no symbol is printed beside the number: a correct figure with the wrong symbol next to it is worse than no symbol.

Does it handle a fractional rate?

Yes. Rates like 8.25 or 17.5 percent work exactly as written, and adding then removing the same rate returns the original amount to the penny.

Sales Tax and VAT Calculator

Tax on or off, without the subtraction mistake.

Amount

Tax rate

Direction

Add taxRemove tax

Tax on or off, without the subtraction mistake.

How to use it

Enter the amount. Either the price before tax or the price including it.
Set the rate and the direction. Add tax works forwards, remove tax works back to the original.
Read all three figures. Before tax, the tax itself, and after tax, so the arithmetic is checkable.

When you would use this

Adding tax is a multiplication anyone can do. Removing it is where this goes wrong, constantly, in real invoices. If a price of 120 includes 20 percent tax, the tax is not 24. It is 20, because the 20 percent was applied to 100 and not to 120. Subtracting 20 percent gives 96 and is wrong by 4. The correct operation is to divide by 1.2, and getting this backwards is common enough that the direction is a control here rather than an assumption. All three figures are shown on every result: the amount before tax, the tax itself, and the total. That makes the arithmetic checkable at a glance rather than something you have to trust, and it means the tool works for either direction without you having to work out which number you were given. No currency symbol is printed. The arithmetic is identical everywhere and only the rate changes, and a correct number with the wrong symbol beside it is worse than a number with none.

Questions

Why can I not just subtract 20 percent to remove 20 percent tax?: Because the tax was 20 percent of the original price, not of the total. Taking 20 percent off 120 gives 96, and the right answer is 100. Removing tax divides by 1.2 rather than subtracting, and this is the single most common error in this arithmetic.
Which countries does this cover?: All of them, because the arithmetic is the same everywhere and only the rate changes. Nothing here assumes a country or a currency, so no symbol is printed beside the number: a correct figure with the wrong symbol next to it is worse than no symbol.
Does it handle a fractional rate?: Yes. Rates like 8.25 or 17.5 percent work exactly as written, and adding then removing the same rate returns the original amount to the penny.