Tax pass-through in the European beer market

Arbeitspapier

We study the pass-through of indirect taxes on beer prices in the European Union (EU). Exploiting the variation of value added tax rates, beer excise tax rates, and beer prices in a panel of monthly data from 1996 to 2016 of all current 28 EU member states, we estimate the tax pass-through of specific beer excise taxes and ad valorem value added taxes (VAT). VAT is under-shifted at a rate of approximately 70%. Specific excise taxes are almost fully shifted to prices in the EU, but, in contrast to the empirical findings for the US, there is no evidence of over-shifting. The difference between the two tax pass-through rates points towards the importance of imperfect competition in the European beer market. Excise tax increases are passed through faster and at a higher rate than excise tax decreases.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Volkswirtschaftliche Diskussionsbeiträge ; No. 189-19

Classification and Topics

• Classification: Wirtschaft ; Taxation and Subsidies: Incidence ; Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
• Subject: Tax incidence ; Pass-through ; VAT ; Excise Taxes ; Beer

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Ardalan, Aria ; Kessing, Sebastian
• Event: Veröffentlichung
• (who): Universität Siegen, Fakultät III, Wirtschaftswissenschaften, Wirtschaftsinformatik und Wirtschaftsrecht
• (where): Siegen
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/204604
• Last update: 10.03.2025, 11:45 AM CET