Youssef Benzarti, Dorian Carloni, 13 November 2017

In the wake of the Global Crisis, some governments sought to stimulate demand through VAT cuts. This column assesses the success of these measures by investigating who benefited from a VAT cut on sit-down restaurant meals in France. The results show that restaurant owners captured the lions’ share of the tax cut, while employees and consumers benefited substantially less. Further, following subsequent tax increases, restaurant owners increased their prices by four to five times more than they had decreased their prices following the original cut.

Events

  • 17 - 18 August 2019 / Peking University, Beijing / Chinese University of Hong Kong – Tsinghua University Joint Research Center for Chinese Economy, the Institute for Emerging Market Studies at Hong Kong University of Science and Technology, the Guanghua School of Management at Peking University, the Stanford Center on Global Poverty and Development at Stanford University, the School of Economics and Management at Tsinghua University, BREAD, NBER and CEPR
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