增值税豁免、嵌入税和意外后果

Policy Research Working Paper 11120 VAT Exemptions, Embedded Tax,and Unintended Consequences William ChandlerAlastair ThomasFrédéric Tremblay Policy Research Working Paper11120 Abstract The value-added tax (VAT) has proved to be a highly effec-tive tool at raising revenue in developed and developingcountries alike. However, the effective operation of the VATbreaks down in the presence of exemptions. Unlike zerorates, exemptions deny input tax credits, thereby increasingproduction costs and resulting in VAT being embeddedwithin the prices of goods and services. This paper developsa VAT model based on input-output table and householdbudget survey data for 29 European countries to exam-ine the effects of VAT exemptions on final prices and toassess the merits of their use. Simulation results show that exemptions suffer from the same targeting problems asreduced VAT rates, but, in addition, they are non-transpar-ent and have unpredictable and counterproductive indirecteffects. These effects are in addition to the well-known dis-tortionary impact of exemptions on production decisions,and their creation of incentives to self-supply. The paperconcludes that the use of exemptions should be limited toaddressing pragmatic concerns, such as the disproportion-ate compliance costs of small businesses and the practicaldifficulty in taxing margin-based financial services. This paper is a product of the Economic Policy Global Department. It is part of a larger effort by the World Bank toprovide open access to its research and make a contribution to development policy discussions around the world. PolicyResearch Working Papers are also posted on the Web at http://www.worldbank.org/prwp. The authors may be contactedat athomas@worldbank.org. The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about developmentissues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry thenames of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely thoseof the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank andits affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent. VATExemptions,EmbeddedTax, andUnintendedConsequences William Chandler, Alastair Thomas and Frédéric Tremblay* JEL codes: H2, H21, H22, H23 Keywords: VAT, value-added tax, exemption, embedded tax Contents 1Introduction .......................................................................................................................................... 32Methodology......................................................................................................................................... 62.1Data ............................................................................................................................................. 62.2Adjustments................................................................................................................................. 72.3Distribution of Informality........................................................................................................... 82.4Core Tax Component ................................................................................................................... 92.5Iterative Component ................................................................................................................. 102.6Cascading................................................................................................................................... 122.7Assumptions and Limitations .................................................................................................... 143Simulation Results............................................................................................................................... 143.1Effective Tax Rates across Commodities ................................................................................... 153.2Intermediate Inputs versus Final Consumption ........................................................................ 213.3Impacts on Trade Competitiveness ........................................................................................... 233.4Interaction Effects ..................................................................................................................... 253.5Distributional Effects of VAT Exemptions.................................................................................. 264Conclusion........................................................................................................................................... 28References ...................................................................................