Successful tax reform: the experience of value added tax in the United Kingdom and goods and services tax in New Zealand
Tax reform provides many examples of failures - where reforms did not achieve their objectives successfully and sometimes even had to be reversed. However, value added tax (VAT) in the UK and goods and services tax (GST) in New Zealand have survived successfully for many years. This paper describes the nature and brief history of VAT and GST and then assesses the factors that contributed to their success. A key factor is the process of implementation both in allowing effective prior consultation to identify possible problems and improvements as well as preparing the taxpaying public for change. It is also important that the reform was seen to be fair, that there were gains as well as losses and the change was a net improvement. In assessing how the arguments for the introduction of VAT/GST turned out in practice, it is clear that this is a robust form of taxation and has been well able to accommodate the different political pressures in the UK and New Zealand.
|Date of creation:||Jul 2008|
|Date of revision:|
|Publication status:||Published in Journal of Finance and Management in Public Services 1.8(2008): pp. 35-47|
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- Burchell, Stuart & Clubb, Colin & Hopwood, Anthony G., 1985. "Accounting in its social context: Towards a history of value added in the United Kingdom," Accounting, Organizations and Society, Elsevier, vol. 10(4), pages 381-413, October.
- James, Simon & Edwards, Alison, 2008. "Developing Tax Policy in a Complex and Changing World," Economic Analysis and Policy, Elsevier, vol. 38(1), pages 35-53, March.
- Evan Davis & John Kay, 1985. "Extending the VAT base: problems and possibilities," Fiscal Studies, Institute for Fiscal Studies, vol. 6(1), pages 1-16, February.
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