Session

Management, Business and Economics

Description

Increased care, implementation, and greater importance in creating fiscal policies that impact in the economy and family consumption began after the declaration of Independence in 2008, when the first tax reforms were made. But the fiscal reforms called the "Fiscal Package 1" which started its enforcement by the end of 2015, especially the VAT reduced rate for household consumption from 16% to 8% had the main effect on the consumer basket and the family budget, which is also the main approach of this paper. Based on the analysis of many indicators, statistical data and questionnaire we have verified how much was impact in the household budget by the decrease of VAT rate. We will give an overview on the influence of this reform on the household consumption basket by focusing mainly on essential products for living. By comparing the experiences of the countries in the region and the survey with the respondents we will be able to see how these changes were expected by the citizens, how do they evaluate the impact on their family budget, as well as possible suggestions for other positive ways that can contribute in saving the family budget. Hypothesis from the comparison of the results of the findings and the answers from the survey was verified that family consumption basket with VAT reduction has lower cost especially for public services and saving the family budget. While the implication on the general budget of the state from reduced VAT rate is very small, compared to the benefits of low-income households.

Keywords:

VAT, Tax rate, Household Consumption

Session Chair

Arta Mulliqi

Session Co-Chair

Muhamet Gërvalla

Proceedings Editor

Edmond Hajrizi

ISBN

978-9951-550-19-2

First Page

86

Last Page

104

Location

Pristina, Kosovo

Start Date

26-10-2019 3:30 PM

End Date

26-10-2019 5:00 PM

DOI

10.33107/ubt-ic.2019.378

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Oct 26th, 3:30 PM Oct 26th, 5:00 PM

Vat Reduction in 8% and Impact on Household Budget

Pristina, Kosovo

Increased care, implementation, and greater importance in creating fiscal policies that impact in the economy and family consumption began after the declaration of Independence in 2008, when the first tax reforms were made. But the fiscal reforms called the "Fiscal Package 1" which started its enforcement by the end of 2015, especially the VAT reduced rate for household consumption from 16% to 8% had the main effect on the consumer basket and the family budget, which is also the main approach of this paper. Based on the analysis of many indicators, statistical data and questionnaire we have verified how much was impact in the household budget by the decrease of VAT rate. We will give an overview on the influence of this reform on the household consumption basket by focusing mainly on essential products for living. By comparing the experiences of the countries in the region and the survey with the respondents we will be able to see how these changes were expected by the citizens, how do they evaluate the impact on their family budget, as well as possible suggestions for other positive ways that can contribute in saving the family budget. Hypothesis from the comparison of the results of the findings and the answers from the survey was verified that family consumption basket with VAT reduction has lower cost especially for public services and saving the family budget. While the implication on the general budget of the state from reduced VAT rate is very small, compared to the benefits of low-income households.