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Comparison Among Indirect Taxation Methods for Financial Services

Author

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  • Guillermo Peña

Abstract

Purpose: The present paper analyzes the current situation of taxation of financial services, pointing out the main alternative taxation methods. Design/methodology/approach: It is carried out an analysis of them, through the application of all of them to the same numerical example. Originality: Subsequently, a comparison of several methods is carried out based on the results of the numerical example and its essential characteristics. Findings: As a result, a method is found that is both approximately correct and feasible for taxing financial services in VAT, for example, by applying the recently proposed mobile-ratio method.

Suggested Citation

  • Guillermo Peña, 2025. "Comparison Among Indirect Taxation Methods for Financial Services," CESifo Working Paper Series 11909, CESifo.
    • Handle: RePEc:ces:ceswps:_11909
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    File URL: https://www.ifo.de/DocDL/cesifo1_wp11909.pdf
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    References listed on IDEAS

    as
    1. Zee, Howell H., 2005. "A New Approach to Taxing Financial Intermediation Services Under a Value–Added Tax," National Tax Journal, National Tax Association;National Tax Journal, vol. 58(1), pages 77-92, March.
    2. Rita de la Feria & Ben Lockwood, 2010. "Opting for Opting-In? An Evaluation of the European Commission's Proposals for Reforming VAT on Financial Services," Fiscal Studies, Institute for Fiscal Studies, vol. 31(2), pages 171-202, June.
    3. Poddar, Satya & English, Morley, 1997. "Taxation of Financial Services Under a Value-Added Tax: Applying the Cash-Flow Approach," National Tax Journal, National Tax Association;National Tax Journal, vol. 50(1), pages 89-111, March.
    4. Poddar, Satya & English, Morley, 1997. "Taxation of Financial Services Under a Value-Added Tax: Applying the Cash-Flow Approach," National Tax Journal, National Tax Association, vol. 50(1), pages 89-111, March.
    5. Pierre-Pascal Gendron, 2016. "Policy Forum: Canada's GST and Financial Services--Where Are We Now and Where Could We Be?," Canadian Tax Journal, Canadian Tax Foundation, vol. 64(2), pages 401-416.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    financial VAT; taxation methods; VAT; financial services; exemption;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies

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