The Equity Impact of the Value-Added Tax in Bangladesh

October 1, 1994

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Format: Chicago

Shahabuddin M Hossain. The Equity Impact of the Value-Added Tax in Bangladesh, (USA: International Monetary Fund, 1994) accessed December 26, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper investigates the income distributional implications of different value-added tax (VAT) schemes in Bangladesh. The results indicate that a revenue-neutral uniform VAT is regressive in its impact on the income of different households. This paper explores an alternative policy package, consisting of a basic rate of VAT with exemptions for certain commodity groups, chosen on the basis of their distributional characteristics. The welfare consequences of the alternative package are found to be superior to those of the uniform VAT.

Subject: Agricultural commodities, Commodities, Consumption taxes, Excises, Expenditure, Taxes, Value-added tax

Keywords: Agricultural commodities, Commodity group, Consumption taxes, Eastern Europe, Group i. see text, Indirect tax, Shadow consumption tax measure, Uniform VAT, Value-added tax, VAT scheme, VAT system, WP, Zero rating

Publication Details

Pages:

24
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1994/125
Stock No:

WPIEA1251994
ISBN:

9781451854770
ISSN:

1018-5941

Notes

Also published in Staff Papers, Vol. 42, No. 2, June 1995.

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