The Mexican Value-added Tax (vat): Methodology for Calculating the Base**

consumption data that can be incorpoThe value-added tax (VAT) is often a rated into the framework of the law may major component of national fiscal strucnot be available. The existence in VAT tures. While its effects on allocative effilaws of various tax rates and exemptions ciency, inflation, income distribution, and complicates matters further. One solution tax administration have been addressed, to addressing this problem is to start with little work exists on the theoretical base of production data and modify them by ada VAT, given its structure. This is essenjusting for exports, imports, capital transtial for knowing how tnuch of the base is actions, changes in stocks, exemptions, and all intermediate uses (with the help of an actually taxed. Using Mexican national input-output table) in order to arrive at accounts and input-output tables, this pataxable consumption. The possibilities for per develops a methodology for calculating making such an attempt have been inthe theoretical base of the Mexican VAT creasing, as more developing countries for 1980 and 1983 (two years whose inhave begun to prepare their national acdividual VAT structures were considercounts data in line with U.N. guidelines, ably different). The method is applicable and provided a recent input-output table to other VAT systems as well. of the economy concerned is available. Such a methodology is developed in this