Policy & Press
Where research by Youssef Benzarti on VAT pass-through has entered policy debates in Denmark, Japan, the UK, Austria, Spain, Greece, France and across Europe, and press coverage of it.
Eight debates over cutting VAT, most recent first.
Denmark, 2026 — the food VAT proposal
Denmark is preparing to abolish VAT on fruit and vegetables and halve it on the rest of the food basket, at a cost now put at 17.4 billion kroner a year. Whether a cut that size reaches shelf prices is what the Finance Committee asked the Ministry of Finance in June. Among the evidence the Ministry weighed was our Journal of Political Economy study of every VAT change in the European Union between 1996 and 2015, What Goes Up May Not Come Down.
My memo to the Committee answers from the European evidence: what pass-through looks like once the estimates are restricted to food, and to the kind of rate change Denmark is actually proposing, and what the studies the Ministry assembled do and do not establish.
Jyllands-Posten interviewed me in June 2026. TV 2 took the story up on 19 June, setting the estimates against Danske Bank’s calculation that the cut would save a household around 500 kroner a month.
Japan, 2026–27 — the food consumption-tax cut
Japan will cut the consumption tax on food from 8 percent to 1 percent for two years from April 2027. I set out the case against in an interview with Nikkei on 7 July 2026, arguing that a temporary cut risks higher prices once it ends, drawing on the Finnish hairdressing experiment and on the Argentine evidence that monitoring holds increases down when a rate is restored.
The numbers were already in the government’s own record. The Cabinet Secretariat working group that considered the cut minuted pass-through of 13 percent on reductions against 55 percent on increases, averaged over every EU VAT change between 1996 and 2015, together with the Argentine finding that prices ended above where they started once the tax came back, except where the increases were policed.
United Kingdom, 2026 — the hospitality VAT cut
Britain weighed a £12bn VAT cut for hospitality. Dan Neidle’s Tax Policy Associates, whose analyses are read closely by MPs, officials and financial journalists, asked in June 2026 who would actually gain, and answered from our French restaurant study and the asymmetry paper.
Austria, 2026 — the food VAT cut
Austria cut VAT on staple foods from 10 percent to 4.9 percent on 1 July 2026. Two months earlier the Budgetdienst, the independent budget office that costs legislation for the Austrian Parliament, built the asymmetry between increases and decreases into its analysis of the measure.
Spain, 2023 — the basic-foods VAT cut
Spain cut VAT on basic foods in January 2023. The European Commission’s Joint Research Centre assessed the reform in Price Effects of Temporary VAT Rate Cuts: Evidence from Spanish Supermarkets, drawing on our work for the wider evidence on pass-through.
Greece, 2026 — a food VAT cut declined
Greece chose a voluntary supplier price agreement instead of cutting the rate. The small-business institute IME GSEVEE reviewed the evidence first, in Informational Brief 37 of June 2026, drawing on three of our papers.
Europe, 2020 — VAT cuts as pandemic stimulus
Germany cut VAT for six months from July 2020, Britain cut it for hospitality, and Rome floated a cut of its own. Whether any of it would reach shelf prices was fought over while the policies were being written, and our results were the evidence on both sides of it. Bloomberg Opinion made the case against on 26 June. Il Sole 24 Ore followed four days later, asking whether a cut supports demand or firms, and answered it from the Finnish hairdressing experiment: prices fell 6 percent when the tax was cut and rose 11 percent when it came back.
France, 2018 — the reduced rates under review
France cut VAT for sit-down restaurants from 19.6 to 5.5 percent in 2009, at a cost of around €3bn a year, which made it one of the largest business subsidies in the country. Our evaluation of who had gained from it appeared in French as an Institut des politiques publiques brief in May 2018, and the press ran it for four days.
On 7 June the Finance Minister said he would not rule out re-examining the reduced rates on restaurants, housing and transport. The coverage turned with him, from what the 2009 cut had done to which rates might be raised next.
Le Figaro Economie, 28 May · Capital, 29 May · France 2, Journal de 13h, 29 May · France 3, 19/20, 29 May · LCI, 30 May · BFM Business, 30 May · Ouest-France, 30 May · Economie Matin, 31 May · Les Echos, “Restauration, logement, transport : les taux réduits de TVA dans le viseur de Le Maire”, 7 June · L’Express, “A qui profitent les TVA réduites visées par Bercy ?”, 11 June. Also Alternatives Économiques and Libération. IPP brief and press list
Since then: Aix-Marseille School of Economics, “Etude sur une aide aux entreprises : les taux réduits de TVA, notamment dans la restauration”, October 2018 · Telos, September 2019 · Vox-Fi (DFCG), September 2019 · Atlantico, July 2023.
Expert testimony
I served as expert witness for the Federal Trade Commission in FTC v. H&R Block, 2025, filing a report and sitting for deposition. Case materials
In government documents
The Economic Report of the President of February 2018 takes its estimate of American tax compliance costs from our work: “Benzarti (2017) estimates that the total cost of filing all schedules of the Federal income tax increased from $150 billion in 1984 to $200 billion in 2006 (1.4 percent of 2006 GDP).”
The Österreichische Energieagentur applied the asymmetry to Austria’s solar-PV VAT exemption for the climate and energy ministry in “Photovoltaikpreise im Sinkflug”, November 2024.
Other coverage
On the research itself: Chicago Booth Review · Microeconomic Insights · VoxEU · NBER Digest.
On tax filing: Los Angeles Times · Washington Post · Time · Quartz · Marketplace · The Blade.