This is typically the argument for VAT over other sales taxes. In the EU, A would charge $2m + VAT. Let's say 10% for ease. So B would have purchase costs of $2.2m, and would charge $4.4m. $400k of that is VAT, but they get a $200k VAT refund for the VAT paid on the purchase from A. C would charge $6.6m, of which $600k is VAT, and claim $400k VAT back. End result is A, B, and C would all pay $200k VAT each.
In your second example, the VAT inclusive price would still be $6.6k, and the VAT due would still be $600k.
In practice many non-VAT sales taxes also counters this problem by trying to define what makes a "final" sale or a sale to consumers as opposed to other companies, and taxing only that.
In your second example, the VAT inclusive price would still be $6.6k, and the VAT due would still be $600k.
In practice many non-VAT sales taxes also counters this problem by trying to define what makes a "final" sale or a sale to consumers as opposed to other companies, and taxing only that.