Value added tax (VAT) is a sales tax levied on the sale of goods and services" In this system every exchange of goods and services results in a percentage sent to the government vs the Sales tax method of only charging the end consumer a percentage.
For example if you buy a Car you pay sales tax in the US in the VAT system your tax % would be lower but the vehicle would cost more because every part and service to build the car would have had tax due on it vs the current system where only you paid.
Arguably VAT/Sales taxes impact the poor more than the middle/upper classes due to the higher percentage of poor wages spent purchasing items that fall under such levies.