VAT Exemptions. Consequences and Design Alternatives
This book is the only in-depth analysis of VAT to focus on exemptions as a whole. Ten insightful chapters – by economists, lawyers, legal academics, and government tax advisors from a wide variety of jurisdictions – grapple with the essential questions: Are VAT exemptions desirable? Are they avoidable? Are alternative legal designs possible? Are such alternatives necessary? What new problems do such designs give rise to? The authors emphasize in particular the design alternatives to exemptions that characterize ‘modern’ VAT and the newly proposed ‘post-modern’ VAT, both those that are already in operation in some countries and others that have not yet been attempted anywhere in the world. Among the core issues discussed are the following:
- ‘out-of-scope’ supplies and suppliers;
- merit or concessional exemptions for, e.g., charities, healthcare, cultural activities, and education services; and
- ‘technical’ exemptions applied to, e.g., gambling, immovable property, financial and insurance services.
The book’s high-calibre contributions provide a firm foundation for productively carrying the debate forward on traditional European-style VAT vs. modern VAT approaches. Most obviously, the book admirably meets the ongoing need of tax practitioners to assess VAT-related opportunities and pitfalls in order to properly safeguard the interests of their clients. It will also be greatly appreciated by tax counsel, financial services providers, and interested government officials, as well as by academics, students, and researchers in tax matters worldwide.
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PART I. Exemptions – General Considerations.
Chapter 1. Ending VAT Exemptions: Learning from Experience, Towards a Post-Modern VAT; R. de la Feria, Richard Krever.
Chapter 2. The EU Perspective on VAT Exemptions; J. Englisch.
Comments: The EU Perspective on VAT Exemptions; R. Lyal.
PART II. Exemptions for Public Services and Merit Products.
Chapter 3. VAT Treatment of Public Sector Bodies: The Canadian Model; P.-P. Gendron.
Chapter 4. Smoke and Mirrors: Applying the Full Taxation Model to Government under the Australian and New Zealand GST Laws; R. Millar.
Chapter 5. Comparing the Treatment of Charities under Value Added Taxes and Retail Sales Taxes; W. Hellerstein.
PART III. Exemptions for Gambling.
Chapter 6. VAT on Gambling; Y. Margalioth.
Comments: VAT on Gambling; A. Schenk.
PART IV. Exemptions for Immovable Property.
Chapter 7. A Proposal to Improve the VAT Treatment of Housing in the European Union; S. Cnossen.
Chapter 8. VAT and Immovable Property: Full Taxation Models and the Treatment of Capital Gains on Owner-Occupied Residences; R. Millar.
PART V. Exemptions for Insurance and Financial Services.
Chapter 9. VAT and Financial Services: Competing Perspectives on What Should Be Taxed; H. Grubert, R. Krever.
Chapter 10. Further Thoughts on Reforming the VAT: Treatment of Financial Intermediation Services; H. Zee.
Comment: Is the Comprehensive Application of Cash-Flow Taxation Necessary to Integrate Financial Services into an Invoice/Credit VAT? T. Edgar.