How Distortive are Turnover Taxes? Evidence from Replacing Turnover Tax with VAT

We would like to thank Wei Cui, Irem Guceri, Jim Hines, Eric Ohrn, Mathieu Parenti, Nadine Riedel, Nathan Seegert, Sebastian Siegloch, Martin Simmler and the participants at the CESifo Public Economics Area conference, BUY/Utah Applied Microeconomics Workshop, IEB: Workshop on Economics of Taxation, ZEW Public Finance Conference, European Commission JRC Fiscal Policy Modelling Workshop, IIPF, NTA, and Zurich Public Economics in Developing Countries workshop for their comments. Xing acknowledges financial support from National Natural Science Foundation of China (No. 71903125). All omissions and errors are our own. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.

• January 11, 2022