Taxes on sugar-sweetened beverages can promote health and raise revenue. Whether these taxes negatively impact domestic sugar producers, an argument often made by opponents, is understudied. We extended a simulation model based on a uniform specific volume-based tax of UAH 4/L in Ukraine. We estimated best- and worst-case scenarios for reductions in domestic sugar demand to be 162 and 23 000 metric tons. This is at worst ∼0.5% of current exports, meaning decreases in domestic demand could easily be absorbed by export markets given export trends. Due to highly protectionist sugar sector policy, sugar producers would not be able to fully substitute domestic sales revenues through increased export revenues, but the worst-case revenue gap was <0.5% of total sectoral output in recent years. Overall, introducing a tax on sugar-sweetened beverages in Ukraine is likely to have a very limited impact on domestic sugar producers.
Farm exit plays a vital role in the overall productivity growth of the industry. However, little attention is paid to the effects of different support policies on the exit decision. In this paper, we analyze and compare two subsidy schemes—direct subsidies and tax benefits in the form of the special value‐added tax regime on the exit decision. Employing a mixed‐effect logistic model and the farm‐level panel data of Ukrainian commercial farms, we found that both subsidy schemes have a similar effect on the exit decision and reduce the probability of leaving the market. However, this effect is contemporaneous only. The subsidy a farm receives in the current year does not affect next year's exit decision. [EconLit Citations: D22, Q12, Q13, Q18].
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.