VAT collected is returned to the Revenue (Collector General, IRS, etc.) every two months. The total VAT - which the business charges - is deducted from the total VAT on the invoices which it pays out, e.g. phone, light, etc.

For some reason, here, the VAT paid on these goods for re-sale is NOT to be deducted. Normally, this is allowed. However, this specfic business is still to deduct the VAT paid on its other purchases.

It is a bit odd in the text. But who really understands VAT?

"VAT paid on the purchase of goods for re-sale is not deductible, with prejudice to the other VAT payments made in the [two-month] return (telephones, workshops, etc."