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Shocks regulatorios al mercado inmobiliario de Chile: ¿Cuánto del IVA a la vivienda se transfiere a precio de venta?
[Regulatory shocks to housing market: How much of the Chilean VAT on housing sales is transferred to prices?]

Author

Listed:
  • Lozano Navarro, Francisco-Javier
  • Idrovo Aguirre, Byron

Abstract

This study shows that the 2014 tax reform in Chile (Law No. 20.780) caused a significant increase in housing sales prices. We exploit the way tax regulation was applied in Chile to generate an analysis framework based on a natural experiment. By applying difference-in-difference estimation technique, we found that the implementation of VAT on housing sales since 2016 caused an additional increase in prices between 9,6% and 12,6%. In addition, we detect heterogeneity in the transfer of VAT to prices, according to house values and location. Finally, we found two events that caused a rise in housing prices: the announcement of the tax reform in 2014 and the implementation of the Law in 2016.

Suggested Citation

  • Lozano Navarro, Francisco-Javier & Idrovo Aguirre, Byron, 2023. "Shocks regulatorios al mercado inmobiliario de Chile: ¿Cuánto del IVA a la vivienda se transfiere a precio de venta? [Regulatory shocks to housing market: How much of the Chilean VAT on housing sal," MPRA Paper 120017, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:120017
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    More about this item

    Keywords

    real estate; housing; taxation; VAT; difference-in-differences;
    All these keywords.

    JEL classification:

    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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