• Corpus ID: 201607403

Using Temporary VAT Cuts as Fiscal Stimuli – Evidence from the Netherlands ∗ Joke Goes

@inproceedings{Jongen2019UsingTV,
  title={Using Temporary VAT Cuts as Fiscal Stimuli – Evidence from the Netherlands ∗ Joke Goes},
  author={Egbert L W Jongen and Eric van Loon},
  year={2019}
}
Can a temporary VAT cut boost economic activity during a recession? We study the effects of two temporary VAT cuts on home improvement in the Netherlands during the Great Recession, using differences-in-differences. We find full pass-through of the temporary VAT cuts into lower prices, and a substantial boost in sales of home improvement services of 10–11%. In contrast to previous studies abroad, we find limited intertemporal substitution of home improvement. Hence, rather than just bringing… 

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