Of course, it is widely used.....

First question from many (especially service) suppliers.... are you registered for VAT? If not than it will be €x if I invoice you it will be €+vat....

Most of the suggestions above (if not all) for 'improvements' are open to all sorts of abuse.

The real value of VAT is that, from a tax collectors viewpoint, it is cheap to impose and collect, the payee does most of the work.