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dc.contributor.authorNarayan, Paresh Kumar
dc.date.accessioned2017-05-03T16:40:21Z
dc.date.available2017-05-03T16:40:21Z
dc.date.issued2003
dc.date.modified2009-12-18T06:30:13Z
dc.identifier.issn09170553
dc.identifier.doi10.1111/j.1467-940X.2003.00074.x
dc.identifier.urihttp://hdl.handle.net/10072/27725
dc.description.abstractValue Added Tax (VAT) is a general consumption tax levied on goods and services. In September 2002, in the face of mediocre economic performance, deteriorating government finances and stagnant investment levels - all due to the political coups of 2000 -an increase in VAT was recommended to Fijian policy makers by the IMF as a remedy to Fiji's problems. The Fiji government, without an in depth economy wide repercussions of a VAT policy, welcomed it by announcing a 25% increase in VAT in its 2003 budget. Beginning 1 January 2003 all goods and services were levied a VAT rate of 12.5%. In this paper, we use a computable general equilibrium model to examine the economy wide effects of this VAT policy. We find that while the VAT improves government revenue and brings about a small 0.6% increase in real GDP, it fails to address investment levels. VAT actually leads to a decline in investments and a reduction in real consumption and national welfare. We highlight that large amounts of tax revenue are owed to government. This is three times more than what government will collect from the 25% increase in VAT. In this light, an alternative to VAT is to upgrade government's tax collecting mechanism. From this we deduce that the IMF policy is misdirected.
dc.description.peerreviewedYes
dc.description.publicationstatusYes
dc.languageEnglish
dc.language.isoeng
dc.publisherWiley-Blackwell Publishing Asia
dc.publisher.placeAustralia
dc.publisher.urihttp://www.wiley.com/bw/journal.asp?ref=0917-0553
dc.relation.ispartofpagefrom226
dc.relation.ispartofpageto237
dc.relation.ispartofissue3
dc.relation.ispartofjournalReview of Urban & Regional Development Studies
dc.relation.ispartofvolume15
dc.subject.fieldofresearchUrban and Regional Planning
dc.subject.fieldofresearchHuman Geography
dc.subject.fieldofresearchPolicy and Administration
dc.subject.fieldofresearchcode1205
dc.subject.fieldofresearchcode1604
dc.subject.fieldofresearchcode1605
dc.titleThe Macroeconomic Impact of the IMF Recommended VAT Policy for the Fiji Economy: Evidence from a CGE Model
dc.typeJournal article
dc.type.descriptionC1 - Articles
dc.type.codeC - Journal Articles
gro.date.issued2003
gro.hasfulltextNo Full Text
gro.griffith.authorNarayan, Paresh


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