Abstract
Several studies have shown that the country economy is based on oil and fossil fuel based, very vulnerable to factors such as war and sanctions. In recent years the Iranian government is trying to reduce dependence on oil and expanding the tax revenue. In this study the use of tax revenues, the effect of three types of tax rates including corporate tax rate, business tax rate and indirect taxes rate (each share of taxes in GDP) on economic growth in Iran during the Thirty Years' 1981-2010 with using of Auto Regressive Distributed Lags (ARDL) examined. In addition to these three variables, other variables such as annual population growth rate, inflation rate and degree of trade openness on economic growth is examined. The results suggest that the impact of the increase in the rates of these three types of taxes on economic growth is negative and significant, and for an increase in the rate of corporate tax rate, business tax rate and indirect taxes rate by 2/4 and 2/8 and 1/8 of economic growth is reduced. The results also reflect the positive impact of population growth rate, trade openness rate and the negative impact of inflation rate on economic growth in Iran.
Highlights
Taxes has long been regarded as an important source of government incomes and Apart from income duties, other important tasks, including economic stabilization, social welfare, security, Justice, through proper distribution of wealth that are included in the macro-economic targets
The variables, corporate tax rate, business tax rate, indirect taxes rate and the average inflation rate is stationary of the order of one or I (1) and growth rate of GDP per capita Iran, the population growth rate and trade openness stationary or I (0) Are
Because long-term coefficients model without ensuring the long-term equilibrium relationship between the variables are not allowed to test for the presence or absence of an approach long-term relationship between the variables, regardless of the regression of the I (0) or I (1) One of the methods used to co-integration, Pesaran and et al cointegration test [19]
Summary
Taxes has long been regarded as an important source of government incomes and Apart from income duties, other important tasks, including economic stabilization, social welfare, security, Justice, through proper distribution of wealth that are included in the macro-economic targets. States in terms of economic intervention based on theories such as Keynesian economics, classics and etc have important economic role and are responsible for monetary and financial policies, such as determining the tax base and tax rate optimization, investment, research and development, and the creation of appropriate infrastructure, provide economic growth. Set tax rates should be set to leave the least impact damage to the economic system [11]. Since in recent years the Iranian government to reform the tax structure and the introduction of new tax base like VAT, in this study, we try to make the connection between the growth rates of tax and gross national product and economic review. After the section, below the theoretical foundations, research records and pays model and analyze the results, and the conclusions and recommendations offered
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