I know VAT doesn't count towards the foreign tax credit as it is not an income tax, but can you take an itemized deduction (on your Schedule A) for it? Call me crazy but there are lines for "state and local sales taxes" and "other taxes" so it seems like it might be allowable.
I called the IRS and apparently the publication they use to determine which taxes can be deducted doesn't say anything about VAT one way or the other (probably sensibly as it affects such a small minority).
The form itself doesn't say whether a foreign sales tax could be counted under the heading of state/local sales taxes. But also, VAT is not exactly the same as a sales tax in the US, since it is assessed differently and on a broader range of goods and services.
What are your thoughts or experiences?
