Basics on VAT

If it is implemented along the lines of the UK, from what I remember is:

You purchase items and pay VAT. Items you purchase that are part of a service/product resold become a credit on your VAT return.

You sell products and services and collect VAT.

You report all sales and VAT collected.
You report all purchases for resale/manufacture.
You net the two and either you owe the government money or they owe you. Of course if they owe you, they hold onto the money until you owe them....