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Study on reduced VAT applied to goods and services in the Member States of the European Union

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  • Copenhagen Economics

    (Copenhagen Economics)

Abstract

Value Added Tax (VAT) in Europe is regularly subject to intensive debate. It is often argued that the current VAT system should be made more uniform to enhance economic efficiency and to protect the functioning of the internal market. But it is also regularly argued that extending reduced VAT to this or that particular product would create economic benefits such as more employment and less inequality. The study concludes that there seems to be a strong argument for making the current VAT structure more simple and uniform, but also an argument for selective cuts in VAT rates primarily in locally supplied services and parts of the hospitality sector. The authors stress the need to consider each case on its own merits and to appraise whether alternative non-VAT instruments may be preferable to reduced VAT rates.

Suggested Citation

  • Copenhagen Economics, 2008. "Study on reduced VAT applied to goods and services in the Member States of the European Union," Taxation Papers 13, Directorate General Taxation and Customs Union, European Commission, revised Oct 2008.
    • Handle: RePEc:tax:taxpap:0013
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    File URL: https://ec.europa.eu/taxation_customs/sites/taxation/files/resources/documents/taxation/gen_info/economic_analysis/tax_papers/taxation_paper_13_en.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Buettner, Thiess & Madzharova, Boryana & Zaddach, Orlando, 2023. "Income tax credits for consumer services: A tool for tackling VAT evasion?," Journal of Public Economics, Elsevier, vol. 220(C).
    2. Nico Pestel & Eric Sommer, 2013. "Shifting Taxes from Labor to Consumption: Efficient, but Regressive?," SOEPpapers on Multidisciplinary Panel Data Research 624, DIW Berlin, The German Socio-Economic Panel (SOEP).
    3. European Commission, 2013. "Tax reforms in EU Member States - Tax policy challenges for economic growth and fiscal sustainability – 2013 Report," Taxation Papers 38, Directorate General Taxation and Customs Union, European Commission.
    4. European Commission, 2012. "Tax reforms in EU Member States - Tax policy challenges for economic growth and fiscal sustainability – 2012 Report," Taxation Papers 34, Directorate General Taxation and Customs Union, European Commission.
    5. Egbert Jongen & Arjan Lejour & Gabriella Massenz, 2018. "Cheaper and More Haircuts After VAT Cut? Evidence from the Netherlands," De Economist, Springer, vol. 166(2), pages 135-154, June.
    6. Egbert Jongen & Arjan Lejour & Gabriella Massenz, 2018. "Cheaper and More Haircuts After VAT Cut? Evidence from the Netherlands," De Economist, Springer, vol. 166(2), pages 135-154, June.
    7. Bernardi, Luigi, 2014. "Tax reforms in EU Member States subce rhe turn of the New centuri: selected observations," MPRA Paper 56856, University Library of Munich, Germany.
    8. Katerina GAWTHORPE, 2020. "Heterogeneous VAT taxation in the Czech economy," Eastern Journal of European Studies, Centre for European Studies, Alexandru Ioan Cuza University, vol. 11, pages 132-159, December.
    9. Luigi Bernardi, 2014. "Tax Reforms in the EU Member States Since the Turn of the New Century: Selected Observations," Working papers 2, Società Italiana di Economia Pubblica.
    10. Doris Prammer, 2011. "Quality of taxation and the crisis: Tax shifts from a growth perspective," Taxation Papers 29, Directorate General Taxation and Customs Union, European Commission.
    11. European Commission, 2010. "Tax Policy after the Crisis: Monitoring Tax Revenues and Tax Reforms in EU Member States 2010 Report," Taxation Papers 24, Directorate General Taxation and Customs Union, European Commission.
    12. Agustin Redonda, 2016. "Tax Expenditures and Sustainability. An Overview," Discussion Notes 1603, Council on Economic Policies.

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    More about this item

    Keywords

    European Union; VAT; taxation;
    All these keywords.

    JEL classification:

    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies

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