I leverage a Pakistani tax reform that cuts the tax rate on the supply chains of five major industries of the country from 15% to 0% to cast light on the extent of, and mechanisms driving, VAT noncompliance in a representative emerging economy. I find that firms overclaim refunds by 22% and...

I leverage a Pakistani tax reform that cuts the tax rate on the supply chains of five major industries of the country from 15% to 0% to cast light on the extent of, and mechanisms driving, VAT noncompliance in a representative emerging economy. I find that firms overclaim refunds by 22% and...

We use rich, micro-level tax return data for the entire population of small and mediumsized German restaurants and find empirical evidence that these firms employ the misclassification of meal consumption type as a VAT evasion strategy. Using difference-in-differences as well as...

We estimate the impact of investment tax credit on firm fixed investment, using China's 2004 value-added tax reform pilot that introduces a permanent 17%-tax credit for fixed investment in six industries in the Northeastern region. The tax credit raises significantly fixed investment of eligible...

I leverage a Pakistani tax reform that cuts the tax rate on the supply chains of five major industries of the country from 15% to 0% to cast light on the extent of, and mechanisms driving, VAT noncompliance in a representative emerging economy. I find that firms overclaim refunds by 22% and...

A political compromise left defects to the initial design of a value-added tax introduced to Japan in 1989. This paper assesses the efficiency consequence of that political decision. We estimate revenue drains arising from tax-motivated divestures to infer maximum possible efficiency losses from...

It is common to defi ne benefi t eligibility for small business policies by restrictions on the fi rm size. This paper investigates the incentives for a large fi rm to masquerade as many small fi rms by separately incorporating business segments, focusing on the case of the Japanese value-added...

This paper assesses the potential effects of introduction of the reduced VAT rate for small business, based on the EU VAT legislation development. The analysis includes effects on prices, sales, shadow economy and employment. It starts with the assumption of no substantial effect. Survey for...