Does theValue-Added Tax Shift to Consumption Prices?

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Title:Does theValue-Added Tax Shift to Consumption Prices?
Creators:
Viren, Matti
Journal or Publication Title:
AUCO Czech Economic Review, 3, 2, pp. 123-143
Uncontrolled Keywords:Value-added tax, tax incidence, consumption taxes

Abstract

This paper deals with the question of how consumption taxes, especially the value-added tax, affect consumption prices. The analyses are based on data from EU countries for the period 1970–2004. The starting point is a conventional supply-demand analysis of the tax incidence problem. This problem is solved using some simple price mark-up equations, Phillips curves and inflation forecast error equations. All these equations are estimated from panel data from EU countries using different estimators and variable specifications. In addition, an analysis is carried out with Finnish excise taxes using commodity/outlet level micro data for the early 2000s. A general result of all analyses is that more than one half of a tax increase shifts to consumer prices. By contrast, there is less evidence on shifts to producer prices.

Official URL: http://www.ceeol.com/aspx/issuedetails.aspx?issueid=416CC5F1-12EA-4C1E-AE92-74B158D15346&articleid=38C4F46B-DD25-4124-AF9F-94A2AF4B4795

Title:Does theValue-Added Tax Shift to Consumption Prices?
Translated title:Does the Value-Added Tax Shift to Consumption Prices?
Creators:
Viren, Matti
Uncontrolled Keywords:Value-added tax, tax incidence, consumption taxes
Subjects:H Social Sciences > HB Economic Theory
H Social Sciences > HG Finance
H Social Sciences > HF Commerce
Divisions:Section of external journals > AUCO Czech Economic Review
Journal or Publication Title:AUCO Czech Economic Review
Volume:3
Number:2
Page Range:pp. 123-143
ISSN:1802-4696
Publisher:Charles University
Related URLs:
URLURL Type
http://auco.cuni.czPublisher
http://avi.lib.cas.cz/node/183Publisher
ID Code:4452
Item Type:Article
Deposited On:27 Jul 2009 16:19
Last Modified:27 Jul 2009 14:19

Citation

Viren, Matti (2009) Does theValue-Added Tax Shift to Consumption Prices? AUCO Czech Economic Review, 3 (2). pp. 123-143. ISSN 1802-4696

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