Computerizing VAT Invoices in China / Haichao Fan, Yu Liu, Nancy Qian, Jaya Wen.

Format:

Book

Author/Creator:

Fan, Haichao.

Contributor:

National Bureau of Economic Research.

Liu, Yu.

Qian, Nancy.

Wen, Jaya.

Series:

Working Paper Series (National Bureau of Economic Research) no. w24414.

NBER working paper series no. w24414

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2018.

Summary:

This paper documents that an increase in the enforcement of value-added tax (VAT) caused by the adoption of a new technology significantly increased VAT payments by large manufacturing firms in China. The reform contributed to 27.1% of VAT revenues and 12.9% of total government revenues in the five subsequent years. The main mechanism is likely to be a reduction in VAT deductions. The dynamic effects of the reform suggest that the rise in tax revenues is non-monotonic over time, with large short-run gains and smaller, though still positive, long-run gains. The reform also reduced firm revenues and inputs, and increased productivity.

Notes:

Print version record

March 2018.