Impact of VAT reforms on Moroccan household’s food consumption : microsimulation analyses through the QUAIDS model (2001-2014)‎

Abstract EN

This study consists in determining how changes in indirect taxation, particularly VAT, affect differently various groups of household consumption’s structure.

To do so, a Quadratic Almost Ideal Demand System (QUAIDS) is applied to data from the 2000/2001 and 2013/2014 National Household Consumption and Expenditure Surveys in order to estimate elasticities of demand for eight food groups and at the level of five household strata.

Living standard differences of the diverse layers of the population make their preferences and reactions to economic shocks very different and change over time.

It appears that Moroccan households tend to consume less vegetables and high-calorie products (sugars and cereals) and more fruit and protein-rich foods (meat, fish, fats, milk and dairy products).

Moreover, the poorest households consume insufficient quantities of nutritious food products such as dairy products, fish and fruit in 2014, compared to 2001.It also shows that extending the scope of VAT to basic products, especially cereals, would affect Moroccan households’ consumption patterns, especially the poorest, for cereals as well as for other products rich in nutrients such as fish and fruit.