Evaluating the impact of the Value Added Tax reform on raw milk collection in Kosovo
New Medit, vol 16, n.1, (March 2017), pp. 29-35
Jel classification: E62, Q18
The aim of this study was to assess the impact of the Value Added Tax (VAT) reform in 2013 on raw milk collection in Kosovo. A linear regression with panel-corrected standard errors model (LRPCSE) was used to statistically test the hypothesis of no effect of the 2013 VAT reform on the growth rate of monthly raw milk collection. The study utilizes panel data spanning from January 2011 to December 2015. Company level monthly sales, investment, price and raw milk collection data were collected from eight Kosovo dairy plants. Results revealed confirmatory evidence that the 2013 VAT reform significantly (p<0.05) increased the growth rate of monthly raw milk supplied to 60% of dairy plants by 9.7% for the period under consideration. This tax policy would possibly lead to a further formalization of dairy sector in the future.
tax reform, LRPCSE, dairy, Kosovo