Olena V. Sokolovska, 76_04
Sunday, 26 March 2017 20:17 | Author: Покотиленко Р.В. | 
76_04EN Olena V. Sokolovska
PhD in Economics, Research Institute of Fiscal Policy of the University of the State Fiscal Service of Ukraine
Address: 08201, Ukraine, Irpin, 31 Universytetska Str.
Tel.: 38 098 074 37 87. E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
VAT incentives in European countries and main reasons for their application
Section: Macroeconomic and regional problems of industrial development
Ekon. promisl. 2016, 76(4): 41-52
https://doi.org/10.15407/econindustry2016.01.041
Language: Russian
| Full text (PDF)
References:
Vishnevskiy, V.P., Vetkin, A.S., & Vishnevskaya, E.N. (2006) Taxation: theories, problems, solutions. Donetsk: Donetsk National Technical University, the Institute of the Economy of Industry of the NAS of Ukraine [in Russian].
Sokolovs'ka, A.M., Jefymenko, T.I., & Lunina, I.O. (2006). The system of tax privileges in Ukraine in the context of the European experience. Kyiv: Research Financial Institute [in Ukrainian].
Tarangul, L.L. (2012). Budget support and tax incentives for the national economy of Ukraine. Irpin': University of the State Fiscal Service of Ukraine[in Ukrainian].
Ivanov, Ju.B. (2006). Tax aspects of state support of innovative activity of enterprises. In R.M. Nizhegorodtsev (Ed), Materials of the international scientific-practical conference (pp. 114-1170) [in Russian].
Garkushenko, O.M., & Filippova, N.V. (2016). Ways to harmonize VAT rates with European ones: problems and challenges. Econ. promysl., 3(75), 49-73 [in Ukrainian].
Auerbach, A.J. & Hines Jr., J.R. (1988). Investment tax incentives and frequent tax reforms. NBER Working Paper Nº2492.
Easson, A., & Zolt, E. (2002). Tax incentives. World Bank Institute.
Holland, D., & Vann, R. (1998) Income Tax Incentives for Investment. Tax Law and Drafting, 2, 986-1020.
Klemm, A. (2009). Causes, Benefits, and Risks of Business Tax Incentives. Washington, D.C.: International Monetary Fund.
Velde, D.W. (2013). Tax, investment and industrial policy. In Taxation and Developing Countries Training Notes. EPS Peaks, pp. 35-40.
European Commission. (2014). A Study on R&D Tax Incentives. Final Report.
United Nations. (2000). Tax Incentives and Foreign Direct Investment A Global Survey. United Nations Conference on Trade and Development (UNCTAD).
United Nations. (2005). State Support Measures for Services: An Exploratory Assessment with Scanty data. United Nations Conference on Trade and Development (UNCTAD).
Sokolovska, O., & Sokolovsky, D. (2015). Market and government failures related to the introduction of tax incentives. Economika i sociologiya. 4, 17-26.
EU. (2006). Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax. Official Journal of the European Union L, 347/1.
EU. (2008). Study on reduced VAT applied to goods and services in the Member States of the European Union. Taxation Papers. European Union, 108 p.
European Commission. (2008). The use of differential VAT rates to promote changes in consumption and innovation. Final report, 150 p.
OECD. (2007). The Political Economy of Environmentally Related Taxes.
Aalbers, R., van der Heijden, E., Potters, J., van Soest, D., & Vollebergh, H. (2009). Technology adoption subsidies: An experiment with managers. Energy Economics, 31, 431-442. DOI: http://dx.doi.org/10.1016/j.eneco.2008.12.002. https://doi.org/10.1016/j.eneco.2008.12.002
Cnossen, S. (2009). How Much Tax Coordination in the European Union? International Tax and Public Finance. 10(6), 625-649. https://doi.org/10.1023/A:1026373703108
Avalara. (2016). 2016 European Union VAT rates. Retrieved from http://www.vatlive.com/vat-rates/european-vat-rates/eu-vat-rates/.
PhD in Economics, Research Institute of Fiscal Policy of the University of the State Fiscal Service of Ukraine
Address: 08201, Ukraine, Irpin, 31 Universytetska Str.
Tel.: 38 098 074 37 87. E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
VAT incentives in European countries and main reasons for their application
Section: Macroeconomic and regional problems of industrial development
Ekon. promisl. 2016, 76(4): 41-52
https://doi.org/10.15407/econindustry2016.01.041
Language: Russian
Abstract: The article examines the reasons for applying the reduced VAT rates; we defined two such motives, notably distributional considerations and presence of public and/or merit goods. We also determined that there are some factors influencing on efficiency of reduced VAT rates, notably passing through the lower rate in sales prices, elasticity of demand, which could be considered as main ones. Also these factors include the size of price reduction, signaling effects, product life cycles, level of price reduction, marketing, etc. The indirect influence of reduced VAT rates on economic efficiency appears principally due to cross-border transactions and opportunities to avoid and/or to evade VAT, arising as a result of use of appropriate incentives. Among other factors are rebound effect, innovation and market transformation, free-rider problem, and effects on state budget. We also briefly analyzed both administrative and compliance costs related to the application of reduced VAT rates and main reasons of their occurrence, such as existence of “mixed products”, etc. We examined the data on 28 European countries concerning both standard and reduced VAT rates in 2016. As a result we defined that currently the most common goods and services, covered by VAT incentives in EU countries, are basic foodstuffs; pharmaceutical products; medical equipment for disabled persons; books, newspapers, periodicals; hotel accommodation, restaurants; and public transport, admission to cultural and/or sport events, water supplies.
Keywords: VAT, tax incentives, tax rates, European Union.
Keywords: VAT, tax incentives, tax rates, European Union.
| Full text (PDF)
References:
Vishnevskiy, V.P., Vetkin, A.S., & Vishnevskaya, E.N. (2006) Taxation: theories, problems, solutions. Donetsk: Donetsk National Technical University, the Institute of the Economy of Industry of the NAS of Ukraine [in Russian].
Sokolovs'ka, A.M., Jefymenko, T.I., & Lunina, I.O. (2006). The system of tax privileges in Ukraine in the context of the European experience. Kyiv: Research Financial Institute [in Ukrainian].
Tarangul, L.L. (2012). Budget support and tax incentives for the national economy of Ukraine. Irpin': University of the State Fiscal Service of Ukraine[in Ukrainian].
Ivanov, Ju.B. (2006). Tax aspects of state support of innovative activity of enterprises. In R.M. Nizhegorodtsev (Ed), Materials of the international scientific-practical conference (pp. 114-1170) [in Russian].
Garkushenko, O.M., & Filippova, N.V. (2016). Ways to harmonize VAT rates with European ones: problems and challenges. Econ. promysl., 3(75), 49-73 [in Ukrainian].
Auerbach, A.J. & Hines Jr., J.R. (1988). Investment tax incentives and frequent tax reforms. NBER Working Paper Nº2492.
Easson, A., & Zolt, E. (2002). Tax incentives. World Bank Institute.
Holland, D., & Vann, R. (1998) Income Tax Incentives for Investment. Tax Law and Drafting, 2, 986-1020.
Klemm, A. (2009). Causes, Benefits, and Risks of Business Tax Incentives. Washington, D.C.: International Monetary Fund.
Velde, D.W. (2013). Tax, investment and industrial policy. In Taxation and Developing Countries Training Notes. EPS Peaks, pp. 35-40.
European Commission. (2014). A Study on R&D Tax Incentives. Final Report.
United Nations. (2000). Tax Incentives and Foreign Direct Investment A Global Survey. United Nations Conference on Trade and Development (UNCTAD).
United Nations. (2005). State Support Measures for Services: An Exploratory Assessment with Scanty data. United Nations Conference on Trade and Development (UNCTAD).
Sokolovska, O., & Sokolovsky, D. (2015). Market and government failures related to the introduction of tax incentives. Economika i sociologiya. 4, 17-26.
EU. (2006). Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax. Official Journal of the European Union L, 347/1.
EU. (2008). Study on reduced VAT applied to goods and services in the Member States of the European Union. Taxation Papers. European Union, 108 p.
European Commission. (2008). The use of differential VAT rates to promote changes in consumption and innovation. Final report, 150 p.
OECD. (2007). The Political Economy of Environmentally Related Taxes.
Aalbers, R., van der Heijden, E., Potters, J., van Soest, D., & Vollebergh, H. (2009). Technology adoption subsidies: An experiment with managers. Energy Economics, 31, 431-442. DOI: http://dx.doi.org/10.1016/j.eneco.2008.12.002. https://doi.org/10.1016/j.eneco.2008.12.002
Cnossen, S. (2009). How Much Tax Coordination in the European Union? International Tax and Public Finance. 10(6), 625-649. https://doi.org/10.1023/A:1026373703108
Avalara. (2016). 2016 European Union VAT rates. Retrieved from http://www.vatlive.com/vat-rates/european-vat-rates/eu-vat-rates/.
Last Updated (Monday, 01 May 2017 13:00)
