Summary of the General Discussion on “The Effect of an Introduction of Retail Sales Tax in China”

Abstract

June 01 2018 Summary of the General Discussion on “The Effect of an Introduction of Retail Sales Tax in China” Author and Article Information Online Issn: 1536-0083 Print Issn: 1535-3516 © 2018 by the Asian Economic Panel and the Massachusetts Institute of Technology2018Massachusetts Institute of Technology Asian Economic Papers (2018) 17 (2): 24. https://doi.org/10.1162/asep_a_00603 Cite Icon Cite Permissions Share Icon Share Facebook Twitter LinkedIn MailTo Views Icon Views Article contents Figures & tables Video Audio Supplementary Data Peer Review Search Site Citation Summary of the General Discussion on “The Effect of an Introduction of Retail Sales Tax in China”. Asian Economic Papers 2018; 17 (2): 24. doi: https://doi.org/10.1162/asep_a_00603 Download citation file: Ris (Zotero) Reference Manager EasyBib Bookends Mendeley Papers EndNote RefWorks BibTex toolbar search Search Dropdown Menu toolbar search search input Search input auto suggest filter your search All ContentAll JournalsAsian Economic Papers Search Advanced Search Suresh Narayanan commented that China has a strange value-added tax (VAT) in that it does not zero-rate agricultural products. Therefore, results cannot be generalized. Substituting VAT for business taxes is not heard of. He pointed out that a 5 percent decline in retail sales tax (RST) coupled with a 5 percent increase in VAT will not result in the same amount of government revenue collected because VAT has exemptions and thus the RST has to change more to result in revenue neutrality. The RST has a single collection point only, whereas the VAT has multiple collection points. Li and Liu's model does not take care of this difference in feature. Furthermore, Narayanan asked whether this model applies when there are no labor market frictions. He suggested that the model be extended in this direction. The authors agreed with Narayanan's observation that a decline in VAT and an increase in RST... You do not currently have access to this content.