DP9320 Efficiency and Equity Effects of Taxing the Financial Sector: Lessons from a CGE Model for Belgium

Author(s): Omar Chisari, Antonio Estache, Gaëtan Nicodème
Publication Date: January 2013
Keyword(s): Belgium, financial sector, modeling, sales tax, taxation, VAT
JEL(s): H20, H25, H30, H87
Programme Areas: Public Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=9320

This paper assesses the effects of applying VAT or a sales tax on (intermediate or final) sales of the financial sector. It uses a CGE Model calibrated for a small open economy. It highlights the differentiated sectoral and redistributional effects of these taxes and shows the importance of the financial openness of the economy on these results.