Hi folks, nice to meet so many VAT-warriors.
My locations is Prague/Czech Republic/EU and I have the same couple of problems with VAT...
But (unlike you) I am totally Drupal-newbie. Even I am excited by this wonderful and modular system I am still just exploring possibilities of the system and trying to understand how it works.
Right now I have to make a decision on what system use as a base for next site including 2 separated eshops. I would really like to use Drupal and Ubercart (because of many advantages of Drupal) but the VAT issues...
My question #1 is: what is the status of this VAT project?
My question #2 is: how can I help?

Some notes to VAT processing used here (according to local rules and/or my costumers requests):

1) Prices must be shown both (w/ even w/o the VAT) at the moment. Alternatives "only w/VAT" and "only w/o VAT" are used only for space-saving on web page (switching prices showing w/ x w/o VAT must be enabled even for unregistered user). [USER-REQUEST]

2) Even the cart should show both prices (mainly the price w/VAT). [USER-REQUEST]
The price w/VAT is the main goal > most customers will PAY the amount w/VAT (individuals even professionels). Only professionels outside the local country but inside the EU, with EU tax registration number will pay the amount w/o the VAT. And more: these foreign customers MUST ask for this opinion, 'cause they CAN pay the VAT in the country where the eshop is located (in EU) instead of VAT in their location (different VAT values are used in our countries). [RULE]

3) There are usually 3 levels of VAT: zero level, lower-level (9% here) and normal-level (19% here). Each kind of goods pertains in one of these 3 levels. [RULE]

4) There are many currencies across the EU, not only € - there are still countries not in "€-zone". The prices can be set using the main currency (local or €) and calculated to other currencies using (1a) the convert ratio download from the bank at the moment OR (1b) using fixed ratio set by user OR (2!) using fixed prices in different currencies. [USER-REQUEST]

btw. My costumer is an extreme -> different prices in different currencies based on a user-roles_product-groups matrix...

5) Except the VAT there are also other product-based fees. Eg. Recycling-fee for electronics or "authors fee" (ransom for local reincarnation of RIAA). [RULE]
These fees can be setup by group OR (better) per product. [USER-REQUEST]