Economic effects of VAT reform in Germany

Boeters S, Böhringer C, Büttner T, Kraus M (2010)

Publication Type: Journal article

Publication year: 2010

Journal

Applied economics Taylor & Francis (Routledge)

Publisher: Taylor & Francis (Routledge)

Book Volume: 42

Pages Range: 2165-2182

URI: https://www.finanzwissenschaft.rw.fau.de/files/2020/03/10.1.1.835.959.pdf

DOI: 10.1080/00036840701857952

Abstract

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.

Authors with CRIS profile

Thiess Büttner Lehrstuhl für Volkswirtschaftslehre, insbesondere Finanzwissenschaft

Involved external institutions

Zentrum für Europäische Wirtschaftsforschung (ZEW) DE Germany (DE)

How to cite

APA:

Boeters, S., Böhringer, C., Büttner, T., & Kraus, M. (2010). Economic effects of VAT reform in Germany. Applied economics, 42, 2165-2182. https://dx.doi.org/10.1080/00036840701857952

MLA:

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

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