“Fiscal Devaluation” and Fiscal Consolidation: The VAT in Troubled Times; by Ruud de Mooij and Michael Keen; IMF Working Paper 12/85; March 1, 2012


This paper focuses on two core tax design issues that arise in addressing current fiscal challenges. It first explores the idea, prominent in troubled Eurozone countries, of a “fiscal devaluation”: shifting from social contributions to the VAT as a way to mimic a nominal devaluation. Empirical evidence is presented which suggests that in Eurozone countries… (More)


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