Economic theory predicts that the incidence of a commodity tax like the Value Added Tax (VAT) will be distributed between buyers and sellers depending on the relative elasticities of supply and demand. Standard models of the incidence of commodity taxes, however, often neglect the possibility that some transactions are hidden from tax authorities. VAT schemes have been adopted in more than 130 countries around the world and raise, on average, more than 20% of total government revenue (Keen and Lockwood 2010). According to estimates by the European Commission, the VAT gap is responsible for some €130 billion in lost revenue in 2021 in the EU alone (European Commission et al. 2021). Understanding how the rents of VAT evasion are distributed thus plays a crucial role in determining who bears the burden of value added taxes. However, very little is known about the incidence of evasion in general, and of VAT evasion in particular. In this project, we aim to study how the financial gains of VAT evasion are split between consumers and producers. To achieve this, we plan to conduct detailed surveys of restaurants in Italy, and employ innovative survey methods to quantify the aggregate prevalence of tax evasion.