Tax Incidence in a Vertical Supply Chain: Evidence from Cigarette Wholesale Prices
National Tax Law Journal
I investigate how the burden of consumption taxes not borne by consumers is shared between upstream firms that produce a taxed good and downstream firms that sell the goods. Using novel data on monthly brand-level cigarette wholesale prices and retail prices from Nielsen homescan data, I find that downstream firms that sell cigarettes bear no more than one-third of the firm share of the tax burden.
Tax Incidence, Consumption Taxes, Supply Chain
Kyle Rozema, Tax Incidence in a Vertical Supply Chain: Evidence from Cigarette Wholesale Prices, 71 Nat’l Tax L.J. 427 (2018)
Rozema, Kyle, "Tax Incidence in a Vertical Supply Chain: Evidence from Cigarette Wholesale Prices" (2018). Scholarship@WashULaw. 102.