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Book part
Publication date: 12 April 2012

Fabián Slonimczyk

The 2001 Russian tax reform reduced average tax rates for the personal income tax and the payroll or social tax. It also made the tax structure more regressive. Because…

Abstract

The 2001 Russian tax reform reduced average tax rates for the personal income tax and the payroll or social tax. It also made the tax structure more regressive. Because individuals in the lower income bracket were for the most part not affected, it is possible to estimate the effects of the reform using a differences-in-differences approach. I study the effect of the reform on informal employment. Informality is defined using information on employment registration and self-employment. Applying parametric and semi-parametric techniques, I find evidence that the tax reform led to a significant reduction in the fraction of informal employees. Among the different forms of informality I study, the reform seems to have had the strongest effect on the prevalence of informal irregular activities. I also document stronger effects on individuals who benefited from the largest reductions in tax rates. The strong response to the tax reform is consistent with the emerging consensus in the literature on taxation that changes to the tax system lead to significant behavioral responses, although not necessarily in the form of a reduced labor supply.

Details

Informal Employment in Emerging and Transition Economies
Type: Book
ISBN: 978-1-78052-787-1

Keywords

Abstract

Details

Handbook of Microsimulation Modelling
Type: Book
ISBN: 978-1-78350-570-8

Article
Publication date: 28 April 2022

Kofi Kamasa, David Nii Nortey, Frank Boateng and Isaac Bonuedi

This paper assesses the impact of tax reforms on tax revenue mobilisation in Ghana.

Abstract

Purpose

This paper assesses the impact of tax reforms on tax revenue mobilisation in Ghana.

Design/methodology/approach

The autoregressive distributed lag model together with dynamic ordinary least squares and fully modified least squares techniques were employed on a time-series data spanning from 1980–2018. Exploiting data from IMFs monitoring of fund arrangements database, an index of tax reforms is constructed as a function of the number of successfully implemented tax-related reforms and policy measures per year over the study period.

Findings

Having established the presence of co-integration between tax revenue and its determinants, this paper finds strong evidence that tax-related reforms exert positive and significant impact on tax revenue generation in Ghana. Among other covariates, the results show that the tax base (real GDP), public debt and education (human capital index) significantly boosts tax revenue in the long run.

Originality/value

The success of tax reforms in boosting revenue mobilisation has been examined in light of the buoyancy and elasticity of the tax system in Ghana, albeit with little emphasis on the extent to which tax reforms contribute to tax revenue mobilisation from econometric perspective. This paper fills this gap in the literature by analysing the impact of tax reforms on tax revenue mobilisation in Ghana. As a recommendation, well-designed and implemented tax reforms and policies aimed at increasing the tax base, education and effective utilisation of funds from public debt promise to be instrumental in boosting tax revenue in Ghana.

Details

Journal of Economic and Administrative Sciences, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1026-4116

Keywords

Article
Publication date: 1 March 2004

Gabriela S. Wolfson and Merl M. Hackbart

Using data obtained from the National Conference of State Legislatures (NCSL), we investigate modifications in state tax codes to determine their characteristics, the…

Abstract

Using data obtained from the National Conference of State Legislatures (NCSL), we investigate modifications in state tax codes to determine their characteristics, the apparent trends of state tax reform, and whether changes constituted comprehensive reform or mere incremental adjustments to existing tax structures. Based on the data, we find that few states achieved comprehensive tax reform in the 1990s despite the fiscal surplus that provided an environment conducive to widespread change. Moreover, we find that a significant number of changes that were enacted in the 1990s involved increases or decreases in state tax revenue that were ultimately tied to economic cycles. We suggest that adequacy in state tax collections may be the most common tax principle adhered to with regard to changes in tax structure. We also conclude that reform efforts in the 1990s were most successful when approached in an incremental fashion in the absence of a significant precipitating reform driver.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 16 no. 1
Type: Research Article
ISSN: 1096-3367

Article
Publication date: 1 January 2012

Somaya Ahmed Aly Abdel‐Mowla

This study aims to evaluate effects of tax system reforms on tax obstacles to investment in Egypt and tax evasion. It also aims to analyze differences in burden of tax

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Abstract

Purpose

This study aims to evaluate effects of tax system reforms on tax obstacles to investment in Egypt and tax evasion. It also aims to analyze differences in burden of tax obstacles and extent of tax evasion among different types of enterprises after applying tax reforms.

Design/methodology/approach

The study uses data from Productivity and Investment Climate Surveys 2004 and 2008. A number of indices are constructed to measure incidence and severity of tax obstacles. Two indicators are constructed to estimate incidence and extent of tax evasion. The study adopts a descriptive analytical comparative approach to evaluate changes and differences in severity of tax obstacles, and their effects.

Findings

The results obtained show that tax reforms have resulted in a significant decrease in severity of tax obstacles. However, they are still major obstacles. The overall decrease hides differences in the burden of these obstacles. Reforms were not enough to address needs of small enterprises. The extent of tax evasion decreased. However, it is still a problem as tax obstacles are still major obstacles.

Research limitations/implications

There is a need for more detailed data about problems enterprises face in each phase of interaction with tax administrators and managers’ suggested solutions.

Originality/value

The study evaluates the actual effects of a major economic reform, on the microeconomic level during an important period rather than exploring enterprises’ expectations. The results show that there is a need for more reforms targeting small enterprises.

Details

Journal of Economic and Administrative Sciences, vol. 28 no. 1
Type: Research Article
ISSN: 1026-4116

Keywords

Article
Publication date: 28 March 2019

Odd-Helge Fjeldstad, Merima Ali and Lucas Katera

Inter-organisational cooperation in revenue collection has received limited attention in the tax administration literature. Recent experiences from Tanzania offer a unique…

Abstract

Purpose

Inter-organisational cooperation in revenue collection has received limited attention in the tax administration literature. Recent experiences from Tanzania offer a unique opportunity to examine opportunities and challenges facing such cooperation between central and local government agencies in a developing country context. The administration of property taxes (PT) in Tanzania has been oscillating between decentralised and centralised collection regimes. This paper aims to examine how inter-organisational cooperation affected implementation of the reforms.

Design/methodology/approach

The study draws on data from a variety of sources of information collected during a series of fieldworks over the past decade. Semi-structured interviews were conducted with a wide range of stakeholders, including senior managers and operational staff of the national and municipal tax administrations. The interviews focused on the background and objectives of the property tax reforms, working relations between the central and local government revenue administrations, technical and administrative challenges and innovations, and changes over time with respect to revenue enhancement and implementation of the reforms. Relevant tax legislation and regulations, budget speeches and reports were reviewed.

Findings

Two lessons of broader relevance for policy implementation and PT administration are highlighted. First, institutional trust matters. Top-down reform processes, ambiguity related to the rationale behind the reforms and lack of consultations on their respective roles and expectations have acted as barriers to constructive working relationships between the local and central government revenue agencies. Second, administrative constraints, reflected in poor preparation, outdated property registers and valuation rolls and inadequate incentives for the involved agencies to cooperate hampered the implementation of the reforms.

Originality/value

This paper contributes to the literature on inter-organisational cooperation in revenue collection through a detailed case study of property tax reforms in a developing country context. It also contributes to the literature on policy implementation by identifying political and administrative factors challenging the reform process. In line with this literature, the study shows that policy implementation is not necessarily a coherent process. Instead, it is frequently fragmented and disrupted by changes in policy formulation and access to adequate resources.

Details

Journal of Financial Management of Property and Construction, vol. 24 no. 2
Type: Research Article
ISSN: 1366-4387

Keywords

Article
Publication date: 1 May 1991

Hans J.G.A. van Mierlo

Reconsiders tax reform and economic emancipation of women withrespect to public policy formation in The Netherlands. In particular,investigates the attempts of organised…

Abstract

Reconsiders tax reform and economic emancipation of women with respect to public policy formation in The Netherlands. In particular, investigates the attempts of organised interest groups of the Dutch women′s liberation movement during the 1980s to influence the public policy process on tax form. The theory of public choice is applied as a theoretical framework for this case study of The Netherlands. The analysis starts with an overview of the issues at stake in the tax reform debate in The Netherlands. Organised women′s interest groups have a specific viewpoint on these issues. These viewpoints are expressed in the public policy process by various lobby mechanisms and political arenas in the Dutch political‐economic system. The attempts to influence these mechanisms and arenas in favour of women′s interests appear to have been rather unsuccessful in the 1980s. The Dutch policy process can be characterised by the so‐called “barrier model”. Various barriers in the Dutch policy process offer an explanation for the relative failure of the organised women′s interest groups to influence the tax reform process in The Netherlands. This explanation may also be valid for similar cases in other West European countries, where the same issues of tax reform and women′s emancipation are at stake and where the public policy process has the same characteristics. Finally, formulates some policy recommendations to overcome the barriers in the public policy process on tax reform.

Details

Journal of Economic Studies, vol. 18 no. 5/6
Type: Research Article
ISSN: 0144-3585

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Article
Publication date: 19 June 2020

Wanyi Chen

Tax risk refers to the uncertainty of future corporate taxation. Tax reform is a key issue in major current tax system adjustments that seriously affect a firm's tax risk…

Abstract

Purpose

Tax risk refers to the uncertainty of future corporate taxation. Tax reform is a key issue in major current tax system adjustments that seriously affect a firm's tax risk. In response to changes in the economic environment, many countries are actively executing tax reform. Long-term reforms implemented for a smooth transition may instead increase corporate risk. This study examines the relationship among tax risk, tax reform and investment timing.

Design/methodology/approach

Selecting the Shanghai Stock Exchange and Shenzhen Stock Exchange A-share listed companies' panel data from 2008 to 2017, the paper used survival analysis and the propensity score matching-difference in difference models.

Findings

The results show that a higher corporate tax risk results in more deferred investments, which are further examined using the latest Chinese value-added tax reform as a natural experiment.

Originality/value

The conclusion serves as an important reference for governments to balance reform time and to support enterprises in effectively identifying and managing tax risk under tax reform.

Details

International Journal of Managerial Finance, vol. 17 no. 2
Type: Research Article
ISSN: 1743-9132

Keywords

Article
Publication date: 1 March 2006

Mengzhong Zhang

To boost the fiscal revenue, i.e., government revenue over GDP and central government revenue over government total revenue, China conducted the 1994 fiscal reforms

Abstract

To boost the fiscal revenue, i.e., government revenue over GDP and central government revenue over government total revenue, China conducted the 1994 fiscal reforms. According to some observers, the results of the initial reforms were mixed. This study reveals, contrary to most examinations of previous studies, the 1994 fiscal reforms have been an enormous success in achieving the original policy purposes, although remaining problems still present a daunting task for the Chinese government. This paper examines the factors triggering the 1994 fiscal reforms, reveals the contents and accomplishments of the reforms, explores unfinished tasks and ultimately proposes some policy implications.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 18 no. 4
Type: Research Article
ISSN: 1096-3367

Article
Publication date: 2 August 2022

Yajie Bai and Maoguo Wu

Extensive macro- and micro-economics research has been conducted on China's tax reform, which replaced business tax with value-added tax (VAT). However, existing studies…

Abstract

Purpose

Extensive macro- and micro-economics research has been conducted on China's tax reform, which replaced business tax with value-added tax (VAT). However, existing studies have not clarified the reform's impact on firm-level investment decisions. Hence, this study explored the effect of replacing business tax with VAT on firms' investment efficiency.

Design/methodology/approach

The study used 2010–2018 data from China's A-share listed companies and a difference-in-differences (DID) model to explore the effect of the reform on firm-level investment decisions.

Findings

The authors found that China's tax reform has improved investment efficiency in underinvested firms, increased liquidity and decreased the level of reliance on external financing. The tax reform had a greater effect on investment efficiency in firms with lower liquidity and higher external financing reliance. Its effect was also more significant among non-state-owned and small companies.

Originality/value

This study fills the aforementioned research gap by exploring the effects of China's tax reform, thus providing a theoretical reference and a basis for policymaking.

Details

International Journal of Emerging Markets, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1746-8809

Keywords

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