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The purpose of this paper is to analyze the impact of taxes on economic growth in the long run as well as in the short run.

The study uses simple time series model, where real GDP is dependent variable and different forms of taxes are explanatory variables under ARDL framework from 1976 to 2014 at annual frequency for Pakistan.

Direct taxes have positive relation with economic growth in the long run. Sales tax, tax on international trade (tariffs) and other indirect taxes have positive impact on economic growth of Pakistan in the long run as well as in the short run. However, sales tax and other indirect taxes impact negatively on economic growth in the short run after one year because people realize decline in their real income.

Government should increase direct taxes by increasing tax base. Indirect taxes usually indicate negative impact after one and two years; therefore, government should decrease its reliance on indirect taxes. Government should promote tax awareness among the people which increase the tax morale of people and increase the tax base.

Taxes are disaggregated into direct and indirect taxes, while indirect taxes have been further disaggregated into excise duty, sales tax, surcharges, tax on international trade and other indirect taxes. This study provides useful insight for policy makers in designing taxes and their effect on growth.

The purpose of this paper is to find out the factors contributing to major shifts in the growth of tax revenue through the estimation of structural breaks and analysis of major tax regimes. Recent contributions to optimal tax theory and empirical literature on the Laffer curve effect, based on elasticity of taxable income, challenge the settled understanding on the rate-revenue relationship. In this backdrop, the objective of the paper is to find out the relative significance of changes in tax rate, tax base and administrative reforms in affecting the growth of tax revenue in India. The paper considers tax data spanning a period of six and half decades for five major components of direct and indirect taxes (corporation, personal income, customs, excise and service) of the central government of India.

Unknown break point(s) – single and multiple – in the tax structure are identified by using the Quandt-Andrews and Bai-Perron econometric tests. These tests were conducted for two models of growth of taxes (tax revenue and tax-NDP ratio) estimated using semi-log functions. A simulation exercise was conducted to find out the robustness of the results by varying the trimming parameter and number of breaks. An analytical framework is used to understand the factors associated with these breaks.

There is more than one break identified for every tax component as per the results of Bai–Perron test. The simulation exercise suggests that estimated breakpoints are mostly robust. Economic growth, structural changes in the economy, simplification and rationalization of tax structure, tax competition, policies such as liberalization have contributed to the changing tax regimes. Results of this study suggest that high tax rates have not been, in particular, detrimental to achieving growth in revenue and factors other than changes in tax rates have been more prominent in bringing about the shifts.

This is, perhaps, the first paper exploring the multiple structural breaks in the fiscal variables in India. It offers an understanding of the changing regimes of central government taxes and the underlying factors for the same.

This study analyzes the impacts of income inequality after direct taxation on the gross domestic product as a fiscal policy tool in the development process.

The model of the study is based on Munielo-Gallo and Roca-Sagales (2013), which examined the fiscal policy, income inequality and economic growth simultaneously. The study uses two models to analyze the relationship between income inequality and gross domestic production under direct taxation by employing autoregressive distributed lag (ARDL) model for selected emerging market economies.

Empirical results reveal a negative long-run relationship between variables in some countries in line with the literature, despite a positive relationship in others. Moreover, the results exhibit the negative impact of income inequality after direct taxation on the gross domestic product decreases.

Results of the study highlight the importance of direct taxation on income inequality concerning the reflects on economic growth. It suggests that when the income distribution is fairer, it may positively affect the gross domestic product. The study provides a new perspective to the related literature by investigating the role of income inequality under direct taxation for gross domestic product.

The purpose of this paper is to analyze the impact of tax structures on economic growth in Jordan over the period 1980-2015 using error correction techniques. It provides empirical evidence that the tax structure itself, comprising direct taxes, indirect taxes and total tax revenues, is an insufficient indicator for policymakers, whereas when each tax was included separately in the model, it was found that income tax, corporate taxes and personal taxes influenced per capita income growth negatively and that all of them were distortionary taxes. They greatly reduced both short and long-term per capita growth, while tariffs and consumption taxes were found to influence per capita income growth positively. The study also shows that relying heavily on increasing total taxes without taking into consideration the tax structure of the country would lead to a reduction in per capita income, in contrast to other tax structures that showed positive and neutral effects on per capita income. Tax reform and shifting from income taxes toward consumption taxes and tariffs would therefore enhance the well-being of individuals and increase their share of output.

This study uses an analytical approach in the framework of an error correction model. This approach allows us to overcome many problems in time series data such as non-stationary, serial correlation and endogeneity of variables, which have been ignored in many published studies dealing with time series data.

The analysis shows that consumption and tariffs have a positive effect on per capita gross domestic product growth, whereas income taxes negatively influenced this growth measure. This implies that attention must be paid to a preference for consumption and tariffs to provide sustained growth. The authors recommend that the government objective should shift from raising revenues to achieving social justice and efficiency.

There are two main limitations inherent this study. The first limitation in regard to the missing data in the series for labor force and average years of schooling, interpolation method used to overcome this shortage. While the second limitation is about the importance of the tax structure itself and its direct impact on such patterns of investment which have been considered but within narrow limits.

The relationship between taxes and economic growth is a controversial aspect of economics, because of its high impact on the decisions made by individuals and institutions, along with its direct influence on the economy as a whole. The authors recommend that the Jordanian government’s objective should shift from raising revenues to achieving social justice and efficiency. Furthermore, Jordan’s weak tax performance and ineffective tax structure indicate the importance for policymakers of focusing more closely on enhancing future per capita growth, which can be done by shifting from income tax toward consumption and trade taxes. On another level, policymakers can reform the tax structure in favor of long-run growth by addressing the importance of consumption taxes and trade taxes in their policies, rather than increasing tax rates.

The character of growth is more important than its magnitude. Economic growth should be reflected in the alleviation of poverty reduced inequality and ultimately better living standards. Additionally the authors believe that sustained economic growth can be achieved only if it is broadly based and inclusive. This implies the need to generate jobs for the growing workforce and the adoption of policies to protect and cater for the vulnerable segments of the population. Otherwise economic policy will fail to achieve its objectives.

This study assists policymakers in understanding the relationship between the various types of taxes and economic growth. In particular, the relation between the unique tax structure and growth drivers. This is the first study to analyze tax structure and economic growth in Jordan.

This study aims to determine how taxes can be used to bridge income inequality gap in sub-Saharan Africa (SSA).

A panel data set of 36 SSA countries was analysed using generalised method of moments.

The results suggest that an increase in direct taxes relative to indirect taxes has a positive significant impact on income inequality. This is mostly due to the progressive nature of direct taxes as compared to indirect taxes.

This research contributes to the scant literature on how specific tax components affect income inequality, especially in developing countries.

Purpose – The purpose of this chapter is to provide a comprehensive review of the literature on the importance of taxes as a determinant of FDI attraction.

Approach – The chapter presents the fundamental elements of the conceptual background that explain how and under which circumstances taxation may be a significant factor underlying FDI decisions. Then it proceeds with an extensive review of the qualitative and quantitative literature on the topic. Finally, it draws several relevant conclusions on the main patterns that can be extracted from the evolution of the literature on this field.

Findings – In this chapter we arrive at three major findings concerning the effect of taxes on FDI, and we uncover one interesting puzzle worthy of further research.

First, from the literature review it becomes clear that both FDI and taxes are concepts covering heterogeneous phenomena, and therefore to compare studies, results or to make judgments on the relationship between taxes and FDI, the working definitions of FDI and taxes that are being used needs to be clearly established and understood.

Second, based on the review of the qualitative literature, it becomes clear that while taxes are an important aspect of FDI decisions among managers, they are probably not the main driver of the decision. Moreover, taxes may only play a ‘marginal’ role compared with other determinants of FDI.

Third, looking carefully at the quantitative literature as a whole, there is not a straight answer that permits to unequivocally say that lower taxes increase FDI attraction.

Finally, a puzzle emerges from the tension between what policy makers believe and what the studies show. The review in this chapter puts in evidence that while policy makers believe lowering taxes increases the attractiveness of their territories vis-à-vis FDI, the facts show that taxes appear only to play a marginal role compared with other determinants of FDI. So, why do policy makers put so much faith on tax policies as an FDI attraction tool?

Value – The value of this chapter is threefold. It presents a very complete and up to date review of the literature concerning the impact of taxation on FDI decisions, it analyses the literature's apparently disparate results and groups them into three clear emerging conclusions, and uncovers an interesting public policy puzzle.

The unresolved crisis scenario and a prolonged COVID-19 pandemic increased social inequalities, mainly affecting the most vulnerable groups to access health services. The data in Pakistan show that health coverage benefits less than half of the population and a weak health system forces households to finance their health with out-of-pocket expenses. Therefore, it is a pending task to guarantee universal health coverage and design sustainable and inclusive policies to finance and provide health services. This study aims to offer a unique solution for health financing to Pakistan.

This study uses the VECM model by employing the data from Pakistan to indicate sustainable policies for health financing.

The results of this research show that direct taxes have a positive impact on public health expenditure; on the contrary, indirect taxes have a negative impact; it also confirms the importance of considering the direct tax based on high-income quintiles to guarantee equality and Access to health for all that contributes to human development.

This article leads to the design of a new health system that will be useful for improving the health of Pakistan by presenting a solution to enhance health financing. Meanwhile, Pakistan will experience better conditions in the face of health crises.

Improving health financing through the equality approach can provide public access to the health system and strengthen the positive effects of the health system on socio-economic relations.

This paper provides a unique solution for the ministry of health of Pakistan, International organisations and national authorities to reach a high level of health coverage without any cost to the financial system and increase the cost of living of the Pakistani people.

1. Increase efficient health financing by integrating health coverage programmes.

2. Implementing direct taxes based on income quintiles improves health equality.

3. Indirect tax policies will not positively contribute to health financing.

4. Improving health financing efficiency decreases health inequality.

Increase efficient health financing by integrating health coverage programmes.

Implementing direct taxes based on income quintiles improves health equality.

Indirect tax policies will not positively contribute to health financing.

Improving health financing efficiency decreases health inequality.