Corporate Tax Revenues Research Articles

Complexity Construction of Intelligent Marketing Strategy Based on Mobile Computing and Machine Learning Simulation Environment

Mankind’s research on marketing has a history of hundreds of years, and it has been fruitful in continuous summary and research. Now the theory of marketing has gradually penetrated into the minds of every company and even individual. A successful marketing strategy is the inevitable result of scientific planning and effective implementation. However, the current marketing strategy has gradually failed to meet the needs of corporates. In order to find the best solution for corporate marketing strategy, we built a simulation environment based on mobile computing and machine learning and compared the differences by simulating several companies of the same size in this city (corporate efficiency and revenue and expenditure under the marketing strategy). The results of the study found that intelligent marketing based on machine learning is more suitable for enterprises than general marketing strategies. The efficiency of enterprises has increased by about 20%, and the income of enterprises has increased by more than 30% compared with traditional marketing strategies. This shows that the intelligent marketing strategy based on mobile computing and machine learning to build a simulated environment plays an extremely important role in the peculiarities.

How large is the corporate tax base erosion and profit shifting? A general equilibrium approach

The paper uses the computable general equilibrium model CORTAX to analyse the extent of base erosion and profit shifting (BEPS) in the EU, Japan and the US. Our approach estimates the direct fiscal losses of BEPS and accounts for the second round effects, in particular on the cost of capital and corporate investment. Our central estimates show that the net corporate tax revenue losses in the EU are €36.0 billion per year (7.7% of CIT revenues), €24.0 billion in Japan and €100.8 billion in the US (in both cases representing 10.7% of corporate tax revenues). Our estimates are comparable in size to the global tax revenue losses found using newly reported statistics on foreign affiliates. Our macroeconomic results suggest that eliminating profit shifting would slightly reduce investment and GDP and rise corporate tax revenues, which would positively affect welfare.

Tax Incentives Influence On Corporate Earnings: Evidence From Quoted Manufacturing Companies In Nigeria

This study examines the influence of tax incentives on corporate earnings of quoted manufacturing companies in Nigeria. The operational dimension of tax incentives adopted are annual allowance, investment allowance, and tax holiday; while the proxy for corporate earnings is earnings per share (EPS), with share capital as a moderating variable. Secondary data for this study are sourced from financial reports of 69 manufacturing firms quoted on the Nigerian Stock Exchange out of a population of 81 in agriculture, conglomerates, consumer goods, healthcare, industrial goods, natural resources, oil and gas operations. Results from data analysis using descriptive statistics and multiple regression, showed that EPS is influenced by the specified operational dimensions, adjusted R2 = 0.62, p < 0.05. Thus, tax incentives influence corporate earnings in quoted manufacturing companies in Nigeria. It is, therefore, recommended that tax incentives should be sustained by the government to enhance corporate revenue and improve investment. Also, investment booster agencies should do more to coordinate activities, disseminate information on available incentives, and assist investors towards optimum capacity utilization to efficiently drive the Nigerian economy to higher heights.

The Firm-Level Effects of Monetary Policy: Implications for Firm Performance

We study the dynamic transmission of monetary policy shocks into corporate profitability. We find an initial negative association between the shocks and corporate revenues and expenses. The revenue response is consistent with a consumer substitution effect, while the expense response is consistent with a firm cost of capital effect. The expense effect exceeds the revenue effect, yielding a positive relation between the shocks and profitability. Additional tests show that the effect concentrates in cash rather than accrual revenues and expenses and that it varies predictably with firms’ industry membership and the accounting treatment of firms’ investment outlays.

Ownership control intensity, corporate financial performance and revenue growth since the global financial crisis

The 2008 global financial crisis showed that despite the corporate governance scholars and regulatory efforts of the past 30 years, shareholders’ investments remain at risk due to poor or dishonest decisions made by some distinct groups of corporate stockholders. Using structural equation modeling (SEM), this study investigated the influence of ownership control on 222 public US companies’ performance after the 2008 financial crisis. The authors identify a new construct representing a third dimension (control intensity) of ownership structure, whereas previous literature has identified only two dimensions: identity and concentration. The control intensity construct of managerial ownership was measured using the number of manager-owners among individual shareholders instead of using the traditional ownership concentration measurement method. The study indicates that the higher the individual ownership stake and the lower managerial ownership control intensity are in an organization, the stronger the negative influence of individual ownership on corporate performance and growth

The Role of Conduit Countries and Tax Havens in Corporate Tax Avoidance

Traditional tax havens and conduit countries have different economic and tax characteristics. This paper shows that conduit countries are larger economies, have higher statutory and effective tax rates, have more bilateral treaties and are more transparent. Because of these characteristics, other countries apply lower withholding taxes on income flows to conduit countries compared to tax havens and do not apply CFC-rules on profit income generated in conduit countries. I assess quantitatively the role of tax havens and conduit countries in international corporate tax avoidance taking account of the literature on corporate tax revenue losses, treaty shopping and phantom investment. I allocate the global tax revenues losses due to profit shifting and treaty shopping to individual countries, using GDP, tax rates, FDI positions and FDI income. Traditional tax havens are only responsible for a small part of corporate tax avoidance. Conduit countries are involved in a much larger share, in particular on treaty shopping. A large share of the profit shifting losses is also due to different tax arrangements between other developed countries.

Taxing Capital In The Age Of Intangibles

The challenges of taxing capital are hardly new. Historically, given the differences in corporate profit tax rates across jurisdictions, companies have manipulated pricing to reduce their total tax burden. With advanced economies shifting to the innovation-intensive knowledge-based mode in the post-1980 period, taxing returns to capital became even more challenging since intangible capital assets can be parked in a low tax jurisdiction of choice. Furthermore, this rise of the intangibles economy has posed numerous governance problems, including how we measure economic activity, how we classify products, and importantly how and where economic returns are booked – and thus where and how they are taxed. The rise of the intangibles economies has led to a significant erosion of corporate tax revenue in the innovation-intensive advanced economies, even as the share of national income flowing to capital rose. For developing countries, the erosion is worse and comes on top of substantial erosion of corporate tax revenues from the tangibles economy due to weak tax administration and corruption. However, addressing the erosion would likely have significant redistributive impacts across economies, thereby creating political economy problems for designing and implementing reforms. The intangibles economy thus clearly poses a taxing problem that has been exacerbated by the COVID-19 pandemic, which accelerated the digital transformation, thereby escalating the problems facing governments in taxing intangibles, while at the same time blowing large holes in public finances thereby making it all the more urgent to stop the erosion. In this paper, we take up the following questions: how big is the taxing problem, whose problem is it, and the prospects for success of the various approaches to addressing, including inter alia the various digital services taxes that have been proposed or implemented and the proposed OECD/G20 Inclusive Framework. We conclude that the importance of tax reform in the modern digitalizing economy goes beyond preventing base erosion and profit shifting for it is about sustainable development and future prosperity. And whether we are there yet is a matter of wait and see.

Profit Shifting and Equilibrium Principles of International Taxation

We study the choice between source-based and destination-based corporate taxes in a two-country model, allowing multinational firms to use transfer pricing to allocate profits across tax jurisdictions. We show that source-based taxation is a Nash equilibrium for tax revenue maximizing jurisdictions if domestic and foreign firms generate large revenues. We also show that destination-based taxes are a Nash equilibrium when firms generate low revenues, which implies the presence of multiple equilibria. Both the source and the destination principle coexist in equilibrium when domestic and foreign corporate revenues are intermediate. However, the source principle always tax-dominates the destination principle.

АКТУАЛІЗАЦІЯ ПИТАННЯ ОЦІНЮВАННЯ РИЗИКУ БАНКРУТСТВА ТОРГОВИХ ПІДПРИЄМСТВ В УМОВАХ ПАНДЕМІЇ КОРОНАВІРУСУ

Due to the coronavirus pandemic and the implementation of strict quarantine restrictions, the global economy has faced serious challenges that have increased the number of corporate bankrupts around the world. To survive on market under new conditions any enterprise should be able to promptly assess its risks of insolvency. In Ukraine the trade was one of the most affected areas of the domestic economy (nearly one-third of trade enterprises have gone bankrupt), that is why it is very crucial to find out an adequate model for assessing the bankruptcy risk of commercial enterprises. This article is devoted to the research of challenges and oppor-tunities of trade enterprise insolvency assessment. The object of research is risk discriminant and logit models as an instrument of trade enterprise financial stability assessment, based on the financial indicators. The key research methods were used in the article: analysis of scientific literature and comparison method. In the study, in accordance with the aim, were analyzed foreign (Lithuania, Poland, Russia) and domestic models for assessing the level of bankruptcy risk of trade enterprises, discussed their advantages and disadvantages. Authors came to conclusion, that the most significant problem is the lack of attention to models that forecast the proba-bility of trade enterprises bankruptcy. Moreover a lot of models does not include the indicators of receivables and payables, which can significantly affect the liquidity of the company. The authors also highlighted a number of specific features of trade enterprises, among them are: 1) significant amounts of receivables and payables; 2) food trade enterprises have a fast sales cycle and perishable goods, which significantly increases the risks of the enterprise; 3) stage of the life cycle of the enterprise; 4) a significant level of depen-dence of trading companies on demand, which decreases sharply in a crisis and causes significant fluctuations in corporate revenue; 5) availability of offline and online sales channels. All this features should serve as a basis for further research to improve approaches to assess the risk of bankruptcy of such companies.Keywords: bankruptcy, trade sphere, enterprise, industry features, discriminant model. Через пандемію коронавірусу і введення жорстких карантинних обмежень, глобальна економіка зіткнулася з серйозними викликами, які спричинили різке зростання числа банкрутств підприємств по всьому світу. Однією з найбільш постраждалих сфер економіки в Україні стала торгівля, що актуалізувало проблему вибору адекватної моделі для оцінювання ризику банкрутства торгових підприємств. У дослідженні, відповідно до поставленої мети, проаналізовані зарубіжні та вітчизняні моделі оцінки рівня ризику банкрутства підприємств торгівлі, виділені їх переваги та недоліки. Найсуттєвішою проблемою відзначається недолік уваги до моделей, які оцінюють ймовірність банкрутства підприємств торгівлі. Авторами також виділені ряд специфічних осо-бливостей підприємств сфери торгівлі, урахування яких повинно послужити базою для подальших досліджень в напрямку вдосконалення підходів до оцінки ризику банкрутства таких компаній.Ключові слова: банкрутство, сфера торгівлі, підприємство, галузеві особливості, дискримінантна модель.

Fair Corporate Taxation: Why and How International Tax Rules Need to Be Changed

Tax avoidance harms public budgets as is estimated that at least 20 per cent of corporate income tax revenues are lost due to such corporate behaviour. Furthermore, the business models used by multinational enterprises to reduce tax payments (such as letterbox-type practices) have a detrimental impact on productive investment, on workers’ involvement in management’s decisions and on collective bargaining for a fair share of the wealth. Indeed, current international tax rules do not take into account the complex business and tax strategies in which multinationals are engaged at global level. First, a move towards a unitary taxation principle is required, which means that the profits of a multinational should be determined globally and shared out between countries in proportion to the real level of economic activity. Second, a global minimum tax rate should limit tax competition between countries and raise corporate tax revenues. And finally, greater transparency about tax practices, including a breakdown of revenues and profits by country (country-by-country reporting), is needed to enable workers’ representatives to understand the tax practices of their companies.

Revisiting corporate income tax determinants in Southern Africa

ABSTRACT The corporate income tax (CIT) systems of developing countries can potentially be contributors or impediments to their economic development. This is especially relevant in the SADC region that has a set agenda regarding regional integration goals, and where the guiding principle is tax harmonisation that benefits all members through tax reform efforts. Despite the importance of the topic, empirical literature remains scant, and this paper attempted to revisit the CIT determinants in the SADC region. Having a larger database at their disposal, the authors could update the existing empirical literature. The sample period of the study included the commodity booms and slumps following the global financial crises, and illustrated the varying fortunes of developing countries in general, and the SADC specifically. Furthermore, given the lower economic growth, together with the variable commodity prices since 2008, there is a concern that corporate tax revenue may continue to erode. A cross-section panel was utilised to determine those factors that may best explain changes in corporate taxes in Southern Africa over the period of time from 1980 to 2017.

The Evaluation of Production Growth and Inflation under Stimulating the Consumer Demand

This article informs about the results of a model experiment conducted at the inter-industry level. The experiment was intended to quantify the growth of gross domestic product resulted from the possible implementation of the Government's financial support program for the poorest people. The possible increase in the inflation rate was taken into account and assessed. The experiment on the model was constructed on the basis of reporting inter-industry balances of 2003, 2014 and 2015, including the division of used products into imported and domestic. The simulated process implied such forms of financial support for poor citizens, which initially lead to an increase in demand mainly (or even exclusively) for domestic products. And then, as the increased demand increases the volume of domestic production and, accordingly, increases the incomes of all segments of the population, the demand for imported products also begins to increase. At the same time as consumption is increasing, there is also an increase in investment due to the increase in corporate revenues and the persistence of all established inter-industry links and basic national economic proportions. Model calculations that reproduce the described process were conducted in several scenarios, involving variations in both the structure of sponsored consumption and the reaction of consumers and producers to the appearance of additional income. The most realistic and preferable (from the economic point of view) variants were considered. The main result of the work done can be considered the following results. First, the experiments found that the greatest economic impact occurs, when financing the additional demand stimulates the growth of domestic production, primarily in the consumer goods (light) and food industries. The most important outcome is that: it is possible to use such methods of stimulating consumer demand. And most importantly, it is possible to use such methods of stimulating consumer demand, in which the emerging growth of gross domestic product significantly exceeds the costs incurred by the state.

THE EFFECT OF FOREIGN DIRECT INVESTMENT ON TAX REVENUE IN DEVELOPING COUNTRIES

The objective of this research paper is to study the effect of Foreign Direct Investment (FDI) on tax revenue in developing countries. FDI net inflow, greenfield, and brownfield FDI are selected as the independent variable, and tax revenue and its types are chosen as the dependent variable. Using panel data analysis, this research finds that FDI net inflow has a positive correlation on total tax revenue, corporate tax revenue, individual tax revenue, and VAT revenue. However, the effect of FDI net inflow on property tax revenue is not statistically significant. This research also finds that in the developing countries, the greenfield FDI has a beneficial effect on tax revenue while brownfield FDI tend to erode tax revenue. To deal with the possibility of endogeneity problems, this research uses “political stability and absence of violence” index as an instrumental variable and conducts a two-stage least square (2SLS) regression to estimate the parameter. The result shows that FDI has a positive correlation on total tax revenue, but not significant. However, the endogeneity test shows that the endogeneity problem is less likely to exist. To conclude, FDI and tax revenue tend to have only one direction effect from FDI to tax revenue.

The real effects of a new accounting standard: the case of IFRS 15 Revenue from Contracts with Customers

International Financial Reporting Standard 15 (IFRS 15) Revenue from Contracts with Customers has significantly changed the philosophy of revenue recognition, not only to provide a fairer representation of corporate revenues, but also to inhibit the use of revenues for ‘earnings management’ purposes. We provide a framework to analyse the various effects of new and amended accounting standards. Changes in how companies recognise, measure, present and disclose their revenues (accounting effects) can affect how companies and their transactions are understood, both internally and externally (information effects), can change security prices (capital market effects) and can change how companies operate, and their costs and cash flows (real effects). We provide empirical evidence, based on a review of corporate annual reports, comment letters and interviews, on the effects of IFRS 15. We find evidence of accounting, information and, to a lesser extent, real effects, although, outside a few industries, IFRS 15 has had relatively little impact on the recognition and measurement of revenue.

Does Accrual Basis Corporate Income Tax Better Predict Future National Corporate Tax Revenue?

Does Accrual Basis Corporate Income Tax Better Predict Future National Corporate Tax Revenue?

Does Capital Bear the U.S. Corporate Tax After All? New Evidence from Corporate Tax Returns

This article uses U.S. corporate tax return data to assess how government revenue would have changed if, over the period 1957–2013, corporations had been subject to a hypothetical corporate cash flow tax—that is, a tax allowing for the immediate deduction of investments in long‐lived assets like equipment and structures—rather than the corporate tax regime actually in effect. Holding taxpayer behavior fixed, the data indicate actual corporate tax revenue over the most recent period (1995–2013) differed little from that under the hypothetical cash flow tax. This result has three important implications. First, capital owners appear to bear a large fraction of the corporate tax today. This is because economic theory holds that corporate cash flow taxes are largely borne by capital owners and my result implies that the actual tax behaves in practice much like a cash flow tax. This theory is embodied in the Treasury's most recent model of corporate tax incidence. Applying the model to my results implies that only a small portion (2–10 percent) of the U.S. corporate tax was borne by labor in the years before the 2017 Act and thus capital providers are the primary beneficiaries of the Act's large corporate rate cut. Second, the results suggest that the United States could switch fully over to a cash flow tax, which is likely to be administratively simpler for both the government and corporations, at relatively low revenue cost. Third, the impact of fully switching to a cash flow tax on the operations of the real economy and its efficiency are likely to be fairly small. This is precisely because the corporate tax has already evolved to largely mimic a cash flow tax, and the article explores the reasons underlying this evolution using a novel dataset.

Analisis Manajemen Risiko Menggunakan ISO 31000 pada Smart Canteen SMA XYZ

Risk is a danger, the consequences or consequences that can occur due to an ongoing process or a future event. Risk always confronts individuals and various institutions, including business organizations. In the business world, risk can be interpreted as an external or internal factor that can cause uncertainty in the effort to achieve the desired goals. Therefore, we need a management called risk management. Risk management is a process of identifying, analyzing, evaluating, controlling, and trying to avoid, minimize, or even eliminate unacceptable risks. In a company, risk management is a process of planning, organizing, directing and controlling the activities of an organization to minimize the risk of corporate revenue. The application of risk management usually uses ISO in accordance with risk analysis and the area to be focused. The stages of risk management analysis itself are, 1. Risk Collection, 2. Determining Scale, and 3. Risk Matrix. The results obtained from the risk management analysis will be in the form of suggestions, recommendations and mitigations.

What is Driving the Decline in Contributions of Multinational Firms to Corporate Tax Revenues?

This paper explores reasons for declining contributions of multinational firms to corporate tax revenues. Using a population of UK firms, I show that over the period 2000 - 2014 multinationals paid a declining fraction of corporate tax revenues, while expanding in size. In 2014 over 70% of total assets reported on UK company balance sheets were held by companies that paid no tax and were part of a multinational group. Further, tax incentives for small and medium companies have increased the number and the corporate tax revenues from those companies. I analyze potential reasons for why these patterns occurred.

Lifestyle Taxes in the Presence of Profit Shifting

Non-communicable diseases (NCDs) cause about 71% of all deaths globally and a considerable increase in health care costs. To tackle this problem, several Governments have designed “sin taxes”, i.e, extra payments related to the quantity of unhealthy contents of specific goods. However, unhealthy food and soda drinks are often produced by multinational companies for which also profit shifting is a serious issue. The international dimension of these markets may have a dramatic impact on the actual implementation of sin taxes. This article contributes to the literature by analysing the effectiveness of sin taxes levied on a good produced by a multinational company. Our analysis shows that a trade off between profit shifting and lifestyle taxes may exist. In general, the First Best sin tax cannot be levied if Governments are also interested in corporate tax revenue. This is a quite interesting policy issue: countries that today benefit from profit shifting may find it harder to impose significant lifestyle taxes. We also provide some insights about the effects that the international effort to fight profit shifting may have on lifestyle taxes.

Why is Corporate Tax Revenue Stable While Tax Rates Fall? Evidence from Firm-Level Data

While corporate tax rates in OECD countries declined over the last decades, revenues from corporate taxation relative to GDP remained remarkably stable. This paper uses a comprehensive firm-level dataset to provide an explanation for this rate-revenue puzzle in corporate taxation. Focusing on the period 1995-2016, we show that the reduction in corporate tax rates was counterbalanced by a pronounced increase in corporate profits before taxes. We decompose the rise in profits into changes in EBITDA, depreciation, and financial profits. On average, these three factors contributed almost equally to the tax base expansion, albeit differently across sectors, countries, and firm sizes.