Economic effects of VAT reform in Germany

Journal article

Publication Details

Author(s): Boeters S, Böhringer C, Büttner T, Kraus M
Journal: Applied economics
Publisher: Taylor & Francis (Routledge)
Publication year: 2010
Volume: 42
Pages range: 2165-2182
ISSN: 0003-6846
eISSN: 1466-4283


In the tax policy debate, differentiation of value-added taxes (VAT) is often justified by distributional concerns. Our quantitative analysis for Germany indicates that such concerns are misplaced. We find that the abolition of VAT differentiation has only negligible redistributive effects. Instead, reduced VAT rates are found to act as industry-specific subsidies. Whereas the overall welfare effects of pure VAT reforms are very small, a revenue-neutral introduction of a harmonized VAT combined with reductions in the marginal income tax rates or social security contributions turns out to yield substantial welfare gains for all households. © 2010 Taylor & Francis.

FAU Authors / FAU Editors

Büttner, Thiess Prof. Dr.
Lehrstuhl für Volkswirtschaftslehre, insbesondere Finanzwissenschaft

External institutions with authors

Zentrum für Europäische Wirtschaftsforschung (ZEW)

How to cite

Boeters, S., Böhringer, C., Büttner, T., & Kraus, M. (2010). Economic effects of VAT reform in Germany. Applied economics, 42, 2165-2182.

Boeters, Stefan, et al. "Economic effects of VAT reform in Germany." Applied economics 42 (2010): 2165-2182.


Last updated on 2018-09-08 at 17:23