Gross value added at basic prices is defined as output valued at basic prices less intermediate consumption valued at purchasers’ prices.

Although the outputs and inputs are valued using different sets of prices, for brevity the value added is described by the prices used to value the outputs. From the point of view of the producer, purchasers’ prices for inputs and basic prices for outputs represent the prices actually paid and received. Their use leads to a measure of gross value added that is particularly relevant for the producer.

System of National Accounts 2008