Social VAT

As Social VAT taxation of consumption of social security funding is called. With the introduction of such a tax in most cases, the employer contributions are lowered.

The concept was - in addition to the taxation of the scarce resource of energy - from the Swiss economist Hans Christoph Binswanger developed (Foundation ecological tax reform).

Examples

Denmark

A value-added tax similar tax for the financing of social services was introduced in the late 1980s in Denmark as arbejdsmarkedsbidrag ( AMBI ), at the same time the employer contributions for unemployment insurance were abolished. The charge was later merged with the VAT.

Germany

As a social VAT can understand the 2007 by 16% to 19 % increased sales tax increase, at the same time because the contribution to the unemployment from 6.5% to 4.2% was lowered.

Hungary

In June 2009, Hungary decided a complex tax ​​reform package, where labor costs were reduced by 5 percentage points from 32% to 27%, while the value added tax of 20% was increased to 25 %.

France

In France, has been discussed for several years on a social VAT (TVA sociale). At the beginning of 2012, President Sarkozy announced concrete steps to reduce labor costs and increase the value added tax in order to strengthen the competitiveness of the French economy. With an increase in VAT by 1.6 points, the government wants to abolish employers' social contributions of 5.4 % for wages below € 2237. In July 2012, the regulation was prevented by the new president Hollande. In 1994, a similar reform of the wage costs in the French overseas departments of Martinique, Guadeloupe and Reunion has been introduced.