## Distributional Implications of the VAT Reform in the Philippines

_IMF Working Papers, July 1, 2007_

## Source details

**Canonical URL:** [Distributional Implications of the VAT Reform in the Philippines](https://www.imf.org/en/publications/wp/issues/2016/12/31/distributional-implications-of-the-vat-reform-in-the-philippines-21081)

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## Bibliographic details
- Authors: David Locke Newhouse, Daria V Zakharova
- Published: July 1, 2007
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451867176.001

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### Summary
- This paper assesses the distributional impact of the recent VAT reform in the Philippines and evaluates alternative methods to mitigate the effects of the reform on poor households.
- The reform was progressive and relatively well targeted.
- Several mitigating measures were introduced to alleviate the impact of the reform on the poor.
- Although these measures reduced the adverse impact of the VAT reform for all households, a sizable amount of the benefit accrued to high-income households.
- Targeted transfer schemes have the potential to deliver a much higher percentage of benefits to the poor.

### Major findings
- The VAT reform in the Philippines was progressive.
- The reform was relatively well targeted.
- Mitigating measures reduced the adverse impact of the VAT reform for all households.
- A sizable amount of the benefit from mitigating measures accrued to high-income households.
- Targeted transfer schemes can deliver a much higher percentage of benefits to poor households compared with the mitigating measures implemented.

### Subject areas and keywords
- Subject: Consumption, Education, Household consumption, Income, Value-added tax
- Keywords: price, share, spending, tax, VAT, VAT reform, WP

_This summary is based on the IMF Working Paper "Distributional Implications of the VAT Reform in the Philippines" (Working Paper No. 2007/153)._

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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/distributional-implications-of-the-vat-reform-in-the-philippines-21081_