Macro-Distributional Implications of VAT Reform Supporting Public Investment in Cabo Verde

This paper assesses the macroeconomic and distributional effects of VAT reform to finance public investment in Cabo Verde. The analysis shows that VAT reform can strengthen fiscal space and support growth, but may be regressive without accompanying measures.
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Volume/Issue: Volume 2026 Issue 020
Publication date: March 2026
ISBN: 9798229041850
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Topics covered in this book

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Investments and Securities-General , Labor , Economics- Macroeconomics , Public Finance , Taxation - General , Cabo Verde , Central bank policy rate , Econometric models , Interest rate policy , Long term interest rates , Monetary transmission mechanism , IMF country , VAT reform , IMF staff , upside scenario , scenario comparison , Public investment spending , Value-added tax , Income , Consumption , Global

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Spatial Inequality in South Africa: Causes and Policy Option
Pension Reform in Comoros: Union of the Comoros
Summary

This paper assesses the macroeconomic and distributional effects of VAT reform to finance public investment in Cabo Verde. The analysis shows that VAT reform can strengthen fiscal space and support growth, but may be regressive without accompanying measures. Targeted transfers can offset distributional impacts, supporting inclusive and sustainable growth.

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