The changed circumstances of the EU after 1992 have a given rise to concern about possible indirect tax competition and related economic distortions. This paper develops a model, incorporating both a production and a retail sector, to examine the effects of different VAT regimes. This model is...

We characterise optimal fiscal policies in a Real Business Cycle model when the government has access to consumption taxation but cannot credibly commit to future policies. Contrary to the case where only labour and capital income are taxed, the optimal time-consistent policies are remarkably...

One of the arguments advanced in favour of a tax shift from income to consumptiontaxation is that, with tax evasion, such a shift would increase the tax paid by evaders.Given that evasion is concentrated in specific sectors, individuals operating in such sectors,who evade all or most of their...

This article reviews research on the taxation of electronic commerce, with a focus on sales taxes in the USA (where retailers are not always obligated to collect sales taxes for online sales). The literature has found evidence that sales taxes have large effects on buying behaviour online, which...

One of the main rationales for taxing consumption rather than income is that it is believed that consumption taxes discourage consumption, encourage savings, and thus generate higher economic growth. However, empirical evidence on the actual effectiveness of consumption taxes in stimulating...

This book by Alan Viard and Robert Carroll proposes to completely replace the income tax system with a progressive consumption tax.

This article proposes an extension of the influence of consumption taxation to demand by including the competition between products for the same available income. The assumption is that inelastic demand goods and services will obtain a larger share from available income than elastic demand ones....

We characterise optimal fiscal policies when the government has access to consumption taxation but cannot credibly commit to future policies, in a calibrated Real Business Cycle model of the United States economy. Contrary to the case where only labour and capital income are taxed, the optimal...

One of the main rationales for taxing consumption rather than income is that it is believed that consumption taxes discourage consumption, encourage savings, and thus generate higher economic growth. However, empirical evidence on the actual effectiveness of consumption taxes in stimulating...

This article investigates the effect of tax reform from the viewpoint of regime switching and finds that, following a tax-reform announcement with constant government spending, the key factor determining the adjustment patterns of consumption and capital is the relative extent of the...