In 2007, Germany increased the value added tax (VAT) on consumption from 16 percent to 19 percent. According to the supply-side view

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According to the supply-side view, increasing the VAT on consumption effectively reduces the after-tax return on labor (since the goods and services that wages can buy become more expensive), which in turn reduces the after-tax wage rate. This is because workers take home less value for each unit of work, reducing their incentive to supply labor.

In 2007, Germany Increased the Value Added Tax (VAT) on Consumption