Publication:
VAT Refunds and Firms’ Performance: Evidence from a Withholding Reform in Honduras

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dc.contributor.authorPineda Pinto, David
dc.contributor.authorBermĂşdez, Jose Carlo
dc.contributor.authorScot, Thiago
dc.date.accessioned2024-12-12T21:03:55Z
dc.date.available2024-12-12T21:03:55Z
dc.date.issued2024-12-12
dc.description.abstractLate or unreliable refunds of credits undermine the best traits of value-added tax (VAT) systems and might affect firms' growth and investment opportunities. This paper uses administrative tax records in Honduras to study a tax reform that decreased the withholding rate of value-added tax liabilities by credit and debit card (DCC) providers, aiming to curb unrefunded credits. Using a difference-in-differences approach, exploiting differential exposure to the reform, the paper documents that it caused a decrease in excessive withholding and was equivalent to a cut of 1.1 percentage points in effective tax rates faced by treated firms. The paper then evaluates the effects on firms' economic performance and estimate 0 effects on several indicators of economic growth and investment. The results challenge the premise that unrefunded VAT credits are an important constraint to firm growth in certain settings. Keywords: VAT refunds, withholding, firms’ performance.en
dc.identifierhttp://documents.worldbank.org/curated/en/099933312112427212/IDU1159620611a9821440d189681c5d134f6a158
dc.identifier.doi10.1596/1813-9450-10996
dc.identifier.urihttps://hdl.handle.net/10986/42535
dc.languageEnglish
dc.language.isoen_US
dc.publisherWashington, DC: World Bank
dc.relation.ispartofseriesPolicy Research Working Paper; 10996
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttps://creativecommons.org/licenses/by/3.0/igo/
dc.subjectVAT REFUNDS
dc.subjectWITHHOLDING
dc.subjectFIRMS'PERFORMANCE
dc.titleVAT Refunds and Firms’ Performanceen
dc.title.subtitleEvidence from a Withholding Reform in Hondurasen
dc.typeWorking Paper
dspace.entity.typePublication
okr.associatedcontenthttps://reproducibility.worldbank.org/index.php/catalog/205 Link to reproducibility package
okr.date.disclosure2024-12-12
okr.date.doiregistration2025-04-14T11:55:16.049788Z
okr.date.lastmodified2024-12-11T00:00:00Zen
okr.doctypePolicy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/099933312112427212/IDU1159620611a9821440d189681c5d134f6a158
okr.guid099933312112427212
okr.identifier.docmidIDU-15962061-a982-440d-8968-c5d134f6a158
okr.identifier.doi10.1596/1813-9450-10996
okr.identifier.externaldocumentum34434989
okr.identifier.internaldocumentum34434989
okr.identifier.reportWPS10996
okr.import.id6019
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099933312112427212/pdf/IDU1159620611a9821440d189681c5d134f6a158.pdfen
okr.region.administrativeLatin America & Caribbean
okr.region.countryHonduras
okr.sectorCentral Government (Central Agencies)
okr.themeTax policy,Data Development and Capacity Building,Economic Policy,Fiscal Policy,Public Sector Management,Data production, accessibility and use
okr.topicMacroeconomics and Economic Growth::Taxation & Subsidies
okr.topicMacroeconomics and Economic Growth::Fiscal & Monetary Policy
okr.unitProsperity-Econ Pol-Mac/Fis-Tax (EMFTX)
okr.unitDIME Governance & Inst Building (DIME3)
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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