Current Tax Research Articles

PENGARUH BEBAN PAJAK KINI, BEBAN PAJAK TANGGUHAN, TAX TO BOOK RATIO, DAN LEVERAGE TERHADAP KINERJA KEUANGAN (Studi Empiris Pada Perusahaan Sektor Kesehatan yang Terdaftar di Bursa Efek Indonesia 2021-2023)

This research is a quantitative study that aims to determine the effect of current tax burden, deferred tax burden, tax to book ratio, and leverage on financial performance in pharmaceutical health sector companies listed on the Indonesia Stock Exchange (IDX) for the period 2021-2023. In determining the sample of this study using purposive sampling technique, so that 15 samples of companies that meet the criteria are obtained with three years of observation so that the total observations used in this study are 45 reports. This study uses secondary data obtained from the company's financial statements. The data analysis technique uses panel data regression analysis (pooled data) with the help of Eviews 12. The results showed that partially the current tax expense variable has a significant effect on financial performance, the deferred tax expense variable has no significant effect on financial performance, the tax to book ratio variable has a significant effect on financial performance, and the leverage variable has a significant effect on financial performance. From this study also obtained the coefficient of determination (R2) with a value of 0,6528, means that 65.28% of disclosure is explained by the variables between current tax expense, deferred tax expense, tax to book ratio, and leverage. While 34.72% is explained by other variables outside the model.

Determinants of Corporate Tax Avoidance: The Role of Financial Distress, Profitability, and Capital Intensity in Emerging Markets

This study investigates the influence of financial distress, profitability, and capital intensity on tax avoidance among companies listed on the Egyptian stock market from 2020 to 2022. Utilizing a quantitative approach, the research analyzes secondary data from 36 firms that maintained profitability during the study period. Tax avoidance is measured using the Current Effective Tax Rate (CETR), while financial distress, profitability, and capital intensity are assessed through the Altman Z-score, Return on Assets (ROA), and capital intensity ratio, respectively. Multiple regression analysis reveals that profitability has a significant negative effect on tax avoidance, suggesting that highly profitable firms are less inclined toward aggressive tax planning. Conversely, financial distress and capital intensity exhibit no significant relationship with tax avoidance, underscoring the context-specific dynamics in an emerging market like Egypt. These findings contribute to the growing body of literature on corporate tax behavior by highlighting the unique determinants of tax avoidance in developing economies. Policymakers are encouraged to consider these insights when designing tax regulations that promote compliance while addressing economic disparities. Future research should expand on these results by incorporating broader datasets and exploring the role of corporate governance and institutional factors in shaping tax strategies

Current Tax Reading

Current Tax Reading

LEGAL REGULATION OF DOUBLE TAXATION AS A HIDDEN LEGAL ELEMENT IN RUSSIA: PROBLEMATICS AND TAX CONSEQUENCES

The relevance of the study lies in the authors consideration of the problem of hidden double taxation in the current tax legislation of the Russian Federation. The authors have identified the problem that is observed in practice, namely its latent manifestation in various forms, leading to an increase in the tax burden on business entities and citizens. The main method of the study is an analytical review of the problem of latent double taxation within the framework of the current Tax Code of the Russian Federation. The purpose of the study is to substantiate specific examples demonstrating the presence of binary taxation, which, although not an obvious violation of the legislation, but creates significant economic costs and injustice for taxpayers, including the taxation of wages, VAT, excise duties and patent system of taxation, revealing the mechanisms through which there is a hidden double taxation of the same income. The result of the study is a proposal to solve the problem of double taxation within a comprehensive approach, including the possibility of simplifying tax rules, developing a more transparent taxation system, reducing the tax burden of taxpayers, as well as revising the structure of taxation and a clearer definition of taxation principles to prevent hidden double taxation. The key conclusion of the study is the thesis that the introduction of open and clear taxation mechanisms will improve the position of taxpayers and create a more sustainable tax environment in Russia. Further research should focus on combating double taxation, which requires careful analysis and reform of the tax system to ensure its transparency and fairness.

Re - appraising the Tax Exemption of Social Enterprises (SEs) in Malaysia: Selected Tax Exemption Theories

Re-appraising the tax exemption of social enterprises (SEs) in Malaysia from a theoretical perspective involves the underlying frameworks that justify the current tax policies applied to SEs. SEs have increasingly become pivotal in addressing societal challenges such as poverty alleviation, environmental sustainability and community development. The approach taken by Malaysian government to taxing SEs has a notable effect in achieving their social goals. One of the significant constraints for SEs in Malaysia is their tax treatment as business entities. Despite their main purpose is for public good, identical to charitable organizations, SEs are subject to taxation like business entities. Particularly, SEs are not entitled for the tax benefit as offered to charitable organizations. The tax regulatory framework does not recognize a SEs by the legal definition and there are no established tax incentives in the current legal framework that are specific to SEs. Despite the clear fact that charity organizations and charitable activities are exempted from tax, there is no tax exemption granted for SEs in Malaysia. Consequently, SEs are treated as business entities under Income Tax Act 1967. This article utilizes the argument to justify tax exemption for SEs in Malaysia. For the purpose of this discussion, this paper applied library research approach combining legal research methodology which mainly involves document analysis such as case law, legal provision and legal theories to see how they might be used to the subject matter. The paper makes a finding that tax exemption for SEs in Malaysia could be justified based on the theories of Public Good Theory, Donative Theory and the Subsidy Theory. By applying this notion, tax exemption should be granted to SEs not only for charitable organizations

PENGGUNAAN PINJAM NAMA PERSEROAN TERBATAS DALAM PERSPEKTIF HUKUM PAJAK DAN PENGARUHNYA TERHADAP PENERIMAAN PAJAK

The practice of using nominees in business and tax relationships has a significant legal impact, both in terms of legal certainty, accountability, and state revenue. This study examines the legal impact of name borrowing practices on companies as outlined in Decision No. 29 / Rev.G/2022 / PN.Mdn. This case involves the use of the name PT Guna Karya Nusantara by substantive parties to meet the requirements of the tender, which resulted in tax problems due to unknown tax arrears. The study also discusses the weak regulation that allows tax evasion through nominee practices and the ineffectiveness of tax collection in the current Indonesian tax system. From the perspective of legal theory, this study uses Gustav Radbruch's principle of legal certainty and Milton Friedman's theory of accountability to assess emerging legal problems. The results of the analysis show that the non-transparent legal relationship between formal and substantive parties creates legal loopholes that can be exploited, thereby weakening the self-assessment based taxation system. In addition, the direct impact of this practice is significant state losses due to delayed tax revenues. As a solution, the Directorate General of taxes designed the reform of the tax system through the implementation of the Core Tax Administration System (CTAS) in 2025. The system replaces the central and branch taxpayer mechanisms with a single entity, thereby strengthening transparency, accountability, and efficiency in tax enforcement. This study recommends revisions to regulations, including the KUP law and Presidential Regulation No. 12 of 2021, in order to eliminate legal loopholes related to nominees, as well as provide strict sanctions to violators. With a holistic approach, this study concludes that reforming the tax system and strengthening regulation is needed to prevent tax evasion and ensure the fairness and effectiveness of the law in supporting state revenue

The Influence of Green Tax Regulations on New Renewable Energy Funding in Indonesia

<div><table cellspacing="0" cellpadding="0" align="left"><tbody><tr><td align="left" valign="top"><p>Reen taxes, such as carbon taxes, can help countries invest in the latest technologies and achieve sustainable prosperity by funding renewable energy. However, we see that the current tax system still needs to be improved. This research aims to analyze the Influence of Green Tax Regulations on New Renewable Energy Funding in Indonesia. This research employs a normative legal approach informed by a literature review. The research results show that the various regulations regarding green tax regulations impact the non-maximization of new renewable energy funding. Taxes can generate government revenue by trading carbon credits to reduce greenhouse gas emissions. Additional funds can be used to fund initiatives in alternative settings. Green taxes, such as carbon taxes, can help countries invest in emerging technologies and achieve sustainable prosperity by providing funding for renewable energy.</p></td></tr></tbody></table></div>

Determinants of Small Business Tax Compliance Behaviour: Evidence From Zimbabwean Small Businesses

Many developing countries have implemented tax regulations for small enterprises and the simplification of tax systems in recent times. Tax compliance attitudes within this sector vary significantly due to the high cost to comply and the technical nature of tax law. Many different factors influence presumptive tax compliance and previous research did not necessarily identify the determinants of this phenomenon. Two hundred and nineteen small business owners/managers participated in the study. The validation of the measurement model and the structural model was performed using the Partial-Least Squares Structural Equation Model. The study evaluated the impact of tax morale, corruption and taxpayer/tax office relationships on presumptive tax compliance in the Zimbabwean context. It was found that corruption significantly influences small business operators’ compliance levels under a presumptive tax system. Significant differences were found in small business owners and managers who differed in their perceptions of their relationships with the tax office. The results of this study would assist tax authorities in understanding small businesses’ perceptions when reviewing the current presumptive tax systems. JEL classification: H20, H29 Article History: Received: June 28, 2024; Reviewed: September 5, 2024; Accepted: November 11, 2024; Available online: December 17, 2024.

Unbundling Social Security from the Payroll Tax

This Article emphasizes that social security funding has contributed significantly to the shift in tax burdens from high income and wealth to low and moderate income and wealth individuals. To preserve social security as a welfare program primarily for older individuals and to ameliorate the distributional inequity of funding social security across income and wealth levels, the Article proposes unbundling of the benefit side of social security from its longstanding payroll tax funding mechanism. The Article recommends substituting a budget allocation from general revenues for current payroll tax revenue. The substitution would be accompanied by revenue replacement through limitations on both social security benefits for higher income individuals and more general, high income centric tax expenditures while increasing income tax marginal rates moderately. Modifying social security benefits from their current overinclusive, entitlement structure for all to moderately needs-based entitlement possibly freed from the constraint of the current contribution requirement that makes social security underinclusive would help provide the older population an income to facilitate dignified aging.

Research on Transformation and Upgrading of Equipment Manufacturing Industry and Optimization of Tax Policy Discrepancy: Case of Hebei Province

Operating income of Hebei equipment manufacturing industry exceeded one trillion yuan. In order to further promote the transformation and upgrading, in recent years, the Hebei Provincial Tax Bureau of the State Administration of Taxation has implemented and continued a series of national tax support policies and achieved phased results. However, due to some objective and realistic factors, Hebei equipment manufacturing industry is still lacking. This research takes different stages of enterprise operation as nodes, and gradually sorts out, studies and analyzes the current tax policies according to the links. The results highlight the effectiveness mechanism of the current tax policies for the development of equipment manufacturing industry based on the research. Moreover, based on a variety of real data found in this paper, the data of Hebei equipment manufacturing industry is compared in multiple dimensions to objectively present problems and shortcomings. This paper focuses on the transformation and upgrading of Hebei equipment manufacturing industry and tax policy in a small-cut view and makes policy optimization suggestions based on the tax policy gap, in order to provide reference for the better development of Hebei equipment manufacturing industry.

Post-combustion CO2 capture retrofit from diesel-powered Arctic mines – Techno-economic and environmental assessment

This study evaluates the economic feasibility and environmental impacts of retrofitting a diesel-based powerhouse in the Canadian Arctic with a post-combustion carbon capture process at an active gold mining site isolated from cheaper or cleaner electrical grids. A techno-economic analysis was conducted to determine the total annualized cost (TAC) of implementing a monoethanolamine (MEA) chemical absorption process to mitigate carbon dioxide emissions. The calculated cost per tonne of CO2 captured of $420 reflects the challenges of operating northern sites reliant on diesel fuel. Electricity generation costs, estimated at 0.44 $/kWh, are found to explain most of the variance in cost per tonne compared to other studies. A profitability model, comparing the additional annual expenditure to the current carbon tax exposure (CTE), suggests that carbon pricing alone is insufficient to incentivize investment in energy-intensive carbon capture technologies such as amine-based absorption processes. The sensitivity analysis, which evaluates profitability relative to variations in key variables, highlights the significant impact of the solvent regeneration heat demand. This major cost driver also contributes substantially to the carbon footprint of 0.55 tonnes emitted per tonne captured, as determined by a complementary life cycle assessment.

Addressing the challenges of taxation E-commerce and digital services in the globalized economy

The rapid expansion of e-commerce and digital services has fundamentally transformed the global economic landscape, presenting unprecedented challenges for traditional taxation frameworks. This comprehensive review examines the complexities of implementing effective taxation mechanisms in the digital economy, with particular emphasis on cross-border transactions and digital service providers. The research analyzes current international taxation policies, regulatory frameworks, and emerging solutions adopted by various jurisdictions to address the challenges of digital commerce taxation. Through systematic evaluation of existing literature and case studies, this review identifies key obstacles including permanent establishment definitions, value creation assessment, and jurisdiction determination in digital transactions. The findings reveal significant gaps in current taxation systems and highlight the need for international cooperation in developing standardized approaches to digital economy taxation. The study demonstrates that while some countries have implemented interim measures such as digital service taxes, a more cohesive global framework is essential for sustainable tax revenue collection in the digital age. This review contributes to the growing body of knowledge on digital economy taxation and provides valuable insights for policymakers, tax administrators, and researchers working to develop effective solutions for the evolving challenges of e-commerce taxation.

How american companies can navigate tax complexities in Brazil and seize opportunities

The research explores the complexity of the Brazilian tax system, highlighting its relevance for American companies seeking to operate in the country. The objective is to analyze the challenges and complexities of this system, in addition to identifying opportunities and strategies to mitigate such discounts. The methodology used is a bibliographic review, which covers legislation and studies related to the topic. The conclusion reveals that, despite the difficulties, an in-depth understanding of tax legislation and the adoption of appropriate planning and compliance strategies can transform challenges into opportunities, promoting a fairer and more efficient business environment in Brazil. This approach is, therefore, essential for the sustainable development of companies in the current tax context.

The impact of the Global Minimum Tax on Vietnam's foreign direct investment attraction

This study assesses the impact of the Global Minimum Tax (GMT) on the attraction of foreign direct investment (FDI) in Vietnam. The authors rely on the analytical framework of UNCTAD (2022) and descriptive statistical methods to analyze and evaluate the impact of GMT on FDI attraction. The research findings indicate that the implementation of GMT will affect tax competitiveness, profit shifting, investment location, and investment scale in various degrees and directions. In particular, GMT may create conflicts between current tax laws and GMT rules, leading to inconsistencies and difficulties in enforcing tax regulations. Vietnam will have to compete with other countries in asserting tax jurisdiction over investment activities on its territory. GMT may negatively affect FDI inflows into Vietnam in sectors with a high tax elasticity to investments. Vietnam may be forced to move away from competition for attracting FDI solely based on corporate income tax and shift to new forms of competition. Based on these findings, the paper proposes several recommendations for the Vietnamese government to refine policies related to GMT.

Indonesia’s External Debt Odyssey: Impact of Fiscal and Political Changes from 1999 to 2023

This study aims to identify the factors influencing Indonesia’s dependence on external debt. The data utilized in this research consist of a time series covering the period from 1999 to 2023 on a quarterly basis. The endogenous variable in this study is Indonesia’s external debt, while the exogenous variables encompass fiscal deficit, tax income, inflation rates, and the volatility index. The instrumental variables employed include lags of both endogenous and exogenous variables. Additionally, dummy variables are incorporated for the four government regimes. Two estimation models consistently present a coherent picture. The dynamic fixed-effect model utilized in this research indicates that dependence on external debt is a legacy of previous governments in both models. Historical factors from prior external debt play a pivotal role in determining Indonesia’s external debt level, and the impact of current and past tax revenue periods contributes positively to Indonesia’s ability to increase debt, even though only current tax revenue has a significant impact. Theoretically, fiscal deficits and global economic instability are considered important indicators, but this study found that neither has a consistent and significant influence on Indonesia’s external debt. Controlling inflation rates is also crucial in curbing borrowing behavior from foreign entities. Government regime transitions do not appear to contribute significantly to the management of external debt. Based on the R-squared adjustment test and the Wald test, it is revealed that the exogenous variables, instrumental variables, and dummy variables in this study effectively explain the variation of the endogenous variable.

Socialising of Harmonising Tax Regulation for Micro, Small and Medium Enterprises (MSMEs) in the Village of Kerinjing

The aim of this community service is to give a better understanding of harmonizing tax regulations on micro, small and medium enterprises (MSMEs) in the village of Kerinjing. Tax assistance related to the Socialisation of Harmonisation of Tax Regulations for MSMEs in Kerinjing Village, Tanjung Raja Sub-district, Ogan Ilir Regency that will be carried out aims to provide information and for MSMEs based on applicable provisions both those regulated in Law N0. 7 of 2021 concerning Harmonisation of Tax Regulations. The implementation team made three visits for location surveys, implementation and evaluation of community service activities. Implementation of this community service is on 26 October 2022. The number of participants was 30 people. Implementation methods are lectures, tutorials and discussions. During the implementation, questions and answers and discussions were held to see the understanding of the activity participants. From the results of the service activities, it is clear that there are still many MSME actors who do not yet have an understanding of the harmonization of tax rules. Micro, Small and Medium Enterprises (MSMEs) are expected to report their business tax results as well as possible and to refer to the current tax laws and regulations. The socialisation of harmonisation of tax regulations for MSMEs in Kerinjing Village provided participants with an understanding of the definition of tax, the subject and object of income tax and also provided participants with an understanding of tax obligations related to income tax and value added tax.

Combating tax crimes in Indonesia: tackling the issue head-on

Taxes are undeniably the lifeblood of a country’s financing. However, tax evasion is becoming increasingly rampant in Indonesia, resulting in substantial state losses. Enhanced tax enforcement policies are necessary to combat this crime. The Organization for Economic Cooperation and Development (OECD) has established principles for fighting tax crimes; however, the Indonesian government has been unable to integrate these principles into its tax enforcement policies, leading to gaps related to strategy, investigative powers, organizational structure, resources, and cooperation, which prevent the current measures from being fully effective. This article conducts a descriptive, evaluative, and comparative study of the Directorate General of Taxes’ (DGT) current tax enforcement policy and proposed practices based on the OECD’s principles to identify and elaborate on these gaps and analyse internal and external obstacles hindering effective implementation. This study’s findings reveal a fundamental difference between tax and legal interests that must be appropriately managed within their boundaries; therefore, the key to improving tax enforcement policy in Indonesia lies in combining Primum Remedium (criminal sanctions as the initial response) and Ultimum Remedium (criminal sanctions as the last resort) strategies. Additionally, the provision of adequate investigative powers, sufficient resources, gradual policy implementation, and necessary law amendments are also crucial factors. This study aims to provide the Indonesian government with insights and recommendations to enhance the tax enforcement policy, to combat tax crimes more comprehensively.

Gaps and Fiscal Adjustment for Debt Stability in Climate-Vulnerable Developing Countries: How Large and by How Much?

Abstract We explore the extent of the fiscal resource gap described by climate-vulnerable developing countries which have called for debt flexibility. We compute indices of fiscal sustainability, defined as the difference between an economy’s current tax rate and the “sustainable” tax rate, or the rate which, if constant, would enable the debt-to-GDP ratio at time n to be equal to the debt-to-GDP ratio at time 0, given current policy rules. We estimate short- and medium-term gap indices for 2010 to 2020, and a “climate change gap” (CCG) which incorporates countries’ reported climate change needs for the period 2021–2030. Estimated short- and medium-term gaps capture the 2020 disruption to fiscal sustainability, while CCGs indicate a highly diverse picture: one-third of the sample have CCGs ranging from 10 to 99 % of GDP, another third have CCGs from −8.6 to −0.3 %. Negative CCGs, which imply that immediate adjustments in taxes or spending are not required for fiscal policy sustainability, are surprising but come with a crucial caveat: CCGs are likely to be significantly understated because of data gaps, especially regarding adaptation requirements. This highlights the urgent need for finance and technical assistance dedicated to building national capacities for determining and costing climate change needs.

Juridical Review of The Amount of Administrative Sanctions in the Form of Interest and Interest Rewards PP No 35 of 2023

This research is motivated by the tax collection system in Indonesia using the Self Assessment System. The Self Assessment System is a tax collection system in which the government gives full trust to taxpayers to calculate, deposit and report their own tax obligations. Taxpayers are considered capable of calculating taxes, able to understand the current tax regulations, and have high levels of honesty, and are aware of the importance of paying taxes. Thus, the success of tax collection depends a lot on the taxpayers themselves. The legal research method used in this research is normative juridical research which is research carried out or aimed only at written regulations with the nature of descriptive analysis research which is a method that functions to describe or provide an overview of the object being studied. The data source used is secondary data with quantitative data analysis. The results of this research are Article 113 of the Job Creation Law, taxpayers submit requests for interest compensation to the Head of the KPP where the Taxpayer is registered or where the PKP is confirmed. Submission of applications can be done electronically or in writing by including the Taxpayer's domestic account number. After the taxpayer submits a request for interest compensation to the KPP, no later than one month after the application for interest compensation is received in full, the KPP will process the Taxpayer's application. Interest compensation is paid by the Directorate General of Taxes by transferring it to the account of the Taxpayer who is entitled to receive the interest compensation, then the reporting of the receipt of the interest compensation is reported in the Annual SPT in the following tax yea

The impact of tax deduction on inequality in Russia

The article examines the impact of tax deductions for education and healthcare on income inequality in Russia. The objective of the study is to quantify the redistributive effects of this fiscal measure. Additionally, the paper assesses the potential effects of proposed reforms to tax deductions, with a particular focus on changes proposed in the President’s Address to the Federal Assembly in February 2023 and implemented in 2024. The study uses data from the Federal Tax Service and the Russia Longitudinal Monitoring survey of the National Research University Higher School of Economics (RLMS-HSE), in conjunction with the microsimulation model RUSMOD, which enables the estimation of the short-term redistributive effects of changes in taxes and transfers. The study demonstrated that the current tax deductions for education and health care have a marginal impact on income inequality. Conversely, if tax deductions are reformed in a manner that increases their limits and take-up, this may result in an increase in income inequality.