Composition Of Revenues Research Articles

Do Countries Really Deviate from the Optimal Tax System?

One of the main goals of the literature on optimal tax systems is to reduce the gap between the highly stylized theory of optimal taxation and the practice of fiscal policy reform. Unfortunately, however, we know little about the extent to which the international experience follows the policy prescriptions derived from economic theory, or how those policy prescriptions would change with economic development. Based on the standard theory of optimal tax systems, this paper predicts the possible effects of economic development on the optimal level and composition of tax revenue and empirically tests these predictions with yearly data on three tax instruments from countries at different stages of development. In average, as countries develop, they are shown to collect more tax revenue and switch from regressive tax instruments like the value added tax, to more progressive taxes that become more productive with development, like the personal and corporate income taxes.

Assessment of the Impact of EU Sanctions on Budget Revenues of Russia in the Context of New Industrialization in Terms of National Dimension

The article examines topical issues that assess the impact of EU sanctions on the volume of tax revenues of the consolidated budget of Russia. The main purpose of this study is an attempt to develop a factor model that allows assessing the sanctions impact on the specified tax revenues, describing and analyzing the factors that directly or indirectly affect the formation of the consolidated budget revenues of the Russian Federation, identifying the corresponding relationships during the period of new industrialization. A separate stage of the presented study is associated with the development of the above model, which evaluates the sanctions effect on the composition of tax revenues of the consolidated budget of the Russian Federation and verification of the adequacy of this model. The authors' own research made it possible to develop a conceptual factor model that assesses the impact of the sanctions effect of the EU countries on the composition and volume of tax revenues of the consolidated budget of the Russian Federation, the use of which makes it possible to analyze the proceeds from the tax payments that have come under the influence of the sanctions. The model presented by the authors makes it possible to fundamentally assess the real impact of the applied sanctions on tax revenues of the consolidated budget of the Russian Federation, to develop appropriate directions in the development of the country during the period of the new industrialization of the Russian state.

ТЕОРИЯ И ПРАКТИКА НАЛОГОВОГО РЕГУЛИРОВАНИЯ МУНИЦИПАЛИТЕТОВ РОССИИ (НА ПРИМЕРЕ НИЖЕГОРОДСКОЙ ОБЛАСТИ)

Taxes play a huge role in the life of municipalities, as they ensure the profitability of budgets and the possibility of financing social expenditures. Despite the relative independence of the country's local budgets, the composition of tax revenues is regulated at the Federal level by the country's Budget and Tax codes and a number of Federal laws and Regulations. In General, tax revenues of municipalities of the Russian Federation include mandatory payments of legal entities and individuals to the budget,which include: part of the tax on personal income; tax levied by the USNO; part of excise taxes on gasoline, diesel fuel, motor oils; property and land taxes. While most municipalities granted the rights to administer tax payments within education, is clearly insufficient, as evidenced by endemic deficit of local budgets of the Russian Federation, indicating the ineffectiveness of taxregulation of municipalities. The purpose of this article is to identify problems of regulation of municipalities in Russia(for example, the Nizhny Novgorod region) and develop ways to address them.

STATE TAXES AND LEGISLATIVE TURNOVER IN THE UNITED STATES

Mounting empirical evidence suggests that term limits and, by extension, higher legislative turnover increase the overall size of government and change its spending composition. However, less is known about the turnover's impact on the composition of tax revenues. This study fills this void by exploiting exogenous variation in term limits and redistricting as instruments for legislative turnover, which is found to be positively associated with most state taxes except for the corporate income tax. We hypothesize that the negative association between legislative turnover and corporate income taxes might be influenced by a higher propensity of business owners to enter term‐limited state legislatures. (JEL H7, H3)

Fiscal Dynamics after a Financial Crisis: Evidence from OECD Countries

We analyze the dynamics of fiscal positions in the aftermath of financial crises based on a sample of 23 advanced OECD countries from 1970 to 2016. We apply a local projection approach and confirm that financial distress leads to a strong increase in debt-to-GDP ratios which also appears to be persistent. We provide robust evidence for a persistent shift to expenditures on social security. This shift most likely comes at the cost of public investment. In contrast, evidence in favor of significant changes in the composition of tax revenues is rather weak. Most likely, financial distress leads governments to shift tax burden to revenues from indirect taxes. Our findings also unveil that compositional shifts are especially pronounced in economies with relatively large financial sectors. We conclude that financial distress not only leads to high fiscal costs but also to a deterioration of the quality of public expenditures not only in the short- but also in the medium-run. And, according to our results, governments do not use episodes of financial distress as a window of opportunity to improve the quality of tax structures.

Do Firms Remit at Least 85 Percent of Tax Everywhere?

In this note, we present new evidence about firm remittance in India, and discuss the remarkable similarity and prominence in the role of businesses in tax remittance in three very different tax systems – India, the United States and the United Kingdom. Previous studies of developed countries have concluded that firms remit the great majority of taxes: 83 percent of taxes in the United States, and 87 percent of taxes in the United Kingdom. A recent OECD working paper estimates the share for a sample of 24 OECD countries, and finds an unweighted average of 89.7 percent. The proximity of these estimates suggests an emerging “rule of 85,” but notably absent is any evidence for developing countries, where the tax structure and administrative capacity varies substantially from developed countries. We find, somewhat remarkably, that in India firms remit about the same fraction of total revenue as in the United States and United Kingdom – 87 percent of the total tax revenue collected by the central and state governments. This is true even though the composition of tax revenue in India is very different from that of the United States and the United Kingdom.

Tax structure and growth: How robust is the empirical evidence?

This paper examines the link between the composition of tax revenues and the level of income per capita in the long run. I find that the “tax and growth ranking” suggested by some recent empirical studies is not robust under different assumptions about heterogeneity across countries of the long-run and short-run coefficients in the underlying econometric model. Evidence for significant tax structure effects depends on long-run parameter homogeneity restrictions, underlying pooled mean group estimation, which are found to be invalid.

Elections and the Structure of Taxation in Developing Countries

This article analyses the impact of the electoral calendar on the composition of tax revenue (direct versus indirect taxes). It thus represents an extension of traditional political budget-cycle analyses assessing the impact of elections on overall revenue. Panel data from 56 developing countries over the 1980-2006 period reveals a clear pattern of electorally-related policy interventions. Taking the potential endogeneity of election timing into account, we find robust evidence of lower indirect taxes being applied by incumbent governments in the period just prior to an election. Indirect tax revenue in election years is estimated to be 0.3 GDP percentage points lower than in other years, corresponding to a fall of about 3.4% of the average figure in the sample countries, while there is no such relationship with direct tax revenue.

Elections and the structure of taxation in developing countries

This article analyses the impact of the electoral calendar on the composition of tax revenue (direct versus indirect taxes). It thus represents an extension of traditional political budget-cycle analyses assessing the impact of elections on overall revenue. We appeal to the opportunistic political budget model of Drazen and Eslava (2010) to predict the relationship between taxation structure and elections. Panel data from 56 developing countries over the 1980–2006 period reveals a clear pattern of electorally-related policy interventions. Taking the potential endogeneity of election timing into account, we find robust evidence of lower indirect taxes being applied by incumbent governments in the period just prior to an election. Indirect tax revenue in election years is estimated to be 0.3 GDP percentage points lower than in other years, corresponding to a fall of about 3.4% of the average figure in the sample countries, while there is no such relationship with direct tax revenue.

The level and composition of tax revenue in developing countries: Evidence from unbalanced panel data

Tax reforms in developing countries must necessarily include changing the level of tax revenue and/or its composition. In this connection, we specify models for total tax revenue and its components and estimate them using an unbalanced panel of developing countries over the period 1973–2002. A general finding is that some variables affect both the level and composition of total tax revenue while other affect its components in opposite directions rendering their net effects on the revenue level statistically insignificant. This distinction underscores the need for selecting policy instruments with an eye on the way they might affect individual tax types.

The Political Economy of Lithuania’s Public Finance

Traditionally Lithuania’s public finances are discussed in terms of tax burden and tax administration. Such issues as composition of tax revenues or the structure of public expenditure for some reasons are less atractive both for economists, journalists, politicians and general public at large. The purpose of this article is to fill this gap doing it in the political, cognitive and ideological context existing in our country. The subject is explored in the framework of methodological holism.

Tax Policy for Emerging Markets: Developing Countries

This paper discusses important tax policy issues facing developing countries today. It views tax policy from both the mac- roeconomic perspective, which focuses on broad questions such as the level and composition of tax revenue, and the microeconomic perspective, which focuses on certain design aspects of selected major taxes, such as the personal income tax, the corporate income tax, the value-added tax, excises, and import tariffs. It provides a re- view of the role of tax incentives in these countries, and identifies some policy challenges posed by the globalization of the world economy.

Tax Policy for Emerging Markets: Developing Countries

This paper discusses important tax policy issues facing developing countries today. It views tax policy from both the macroeconomic perspective, which focuses on broad questions such as the level and composition of tax revenue, and the microeconomic perspective, which focuses on certain design aspects of selected major taxes, such as the personal income tax, the corporate income tax, the value-added tax, excises, and import tariffs. It provides a review of the role of tax incentives in these countries, and identifies some policy challenges posed by the globalization of the world economy.

Tax Policy for Emerging Markets: Developing Countries

This paper discusses important tax policy issues facing developing countries today. It views tax policy from both the macroeconomic perspective, which focuses on broad questions such as the level and composition of tax revenue, and the microeconomic perspective, which focuses on certain design aspects of selected major taxes, such as the personal income tax, the corporate income tax, the value-added tax, excises, and import tariffs. It provides a review of the rote of tax incentives in these countries, and identifies some policy challenges posed by the globalization of the world economy.

Fiscal policy and development in Korea

This paper assesses Korea's tax and expenditure policies during the period 1962–1985, with special attention to their implications for the future. In its examination of Korean fiscal policy, the paper is concerned with whether Korea's fiscal system has contributed to the mobilization of domestic resources and whether it possesses a significant capacity for income distribution. In so doing, the paper examines the major deficiencies of the existing fiscal system in order to clarify what problems merit high priority in future tax reforms. Also, an attempt is made to analyze growth and shifts in the composition of tax revenues and expenditures.

A median voter analysis of variations in the use of property taxes among local governments

This paper explores the variations among local governments in the composition of tax revenues, or more specifically, in the relative use of property taxes. Using a median voter framework, various hypotheses are developed concerning the factors that should influence the relative use of property taxes. A cross-sectional sample of central cities is employed to test the hypotheses. The empirical results are consistent with the hypotheses.