General Tax Research Articles

Analysis of Administrative Penalty for Late Issuing Tax Invoices in Indonesia: A Comparative Study from Vietnam

This study analyzes and compares the administrative penalty for late issuing tax invoices between Indonesia and Vietnam. The existence of a penalty has not been a driving factor for taxpayers to fulfill their tax obligations. Article 14 paragraph (4) General Provisions and Tax Procedures Law regulates the tax penalty for late issuing tax invoices, the same as for those who do not issue invoices. The administrative penalty needs to be analyzed more and compared with other countries' practices. VAT penalty cannot necessarily increase the compliance of taxable entrepreneurs. This research uses primary and secondary data sources for the qualitative method. The results of this study indicate that tax penalties should be designed by looking at the level of taxpayer error. Vietnam has no administrative penalty for the late issue of tax invoices but differentiates more penalties for tax invoices according to the level of violation. Tax penalties in Indonesia should be designed by considering the level of taxpayer violation, as Vietnam regulates. Administrative penalties for late tax invoices should not be the same as those imposed on taxpayers who did not issue tax invoices. The study recommends that tax authorities re-design the administrative penalties policy regarding tax invoice violations.

Porezna autonomija lokalne samouprave

The paper measures the total (two-tier) local tax autonomy (cities/municipalities and counties combined) in Croatia applying the OECD methodology in terms of the definition and scope of taxes and their classification according to taxing power and autonomy. First, it follows the methodology of previous studies for Croatia, which considered only nominal taxes. This results in a relatively small share of autonomous taxes in local tax revenues. The change from a formal recording of taxes to an effective one based on the OECD definition of taxes leads to more than a doubling of local autonomous taxes. However, compared to other OECD unitary countries (countries with only the local level), Croatia still lags significantly behind the OECD average and also behind the average of EU member countries that are also OECD member countries. The weighting of different categories, despite the risk of arbitrariness, and the resulting tax autonomy index show an additional improvement of the Croatian situation. Further calculation of the tax autonomy index and, in particular, the composite indicator of tax autonomy (share of autonomous local taxes in total general government taxes), as well as the composite tax autonomy index (local tax autonomy index divided by total general government taxes), lead to a further improvement of the Croatian position. Although the country is still below the OECD average, it has improved to an almost median position. The indicators suggest that the taxing powers of local governments need to be further strengthened.

The effect of applying the internal control system COBIT5 framework on tax performance

The purpose of this research is to analyze the effect of applying the internal control system according to the COBIT5 framework on tax performance. Data was collected from the research sample using the questionnaire form, and the number of distributed questionnaires was (55), distributed to each of the officials and workers in the Iraqi General tax authority, Professionals, and Academics at the University of Baghdad. A set of statistical methods were used to study the relationship between the two research variables, using the statistical program (SPSS) to analyze the data and calculate (the arithmetic mean, correlation coefficient, coefficient of variation, F test, R2 coefficient of determination, T test, Cronbach's alpha coefficient). The research has a significant positive relationship and influence between the framework (COBIT5) and the tax performance. The most influential dimensions of COBIT5 in tax performance dimension delivery, service and support (DSS), followed by evaluation, guidance and control (EDM), while the least influential dimensions in tax performance dimension compliance are planning and organization (APO). The research recommended adopting the COBIT5 internal control framework as a guide for auditors to advise senior management on the efficiency of the internal control system in the tax institution. This includes a governance framework for information technology, which is one of the most important pillars of the corporate governance system. This research also contributes by providing theoretical and practical implications for tax administration to improve the reality of tax performance.

Approaches to Determining the Law of a Constituent Entity of the Russian Federation That Establishes Regional Tax Exemptions: The Experience of the Siberian Federal District

The article notes that when the state authorities of the constituent entities of the Russian Federation exercise the powers to establish tax exemptions for regional taxes they are significantly limited by the provisions of federal legislation. The Tax Code of the Russian Federation establishes an exhaustive list of powers of regional authorities, but in terms of exemptions for regional taxes, it provides the constituent entities of the Russian Federation with the opportunity to determine independently the list of taxpayers and the amount of exemptions. At the same time, the form of the legal act is predetermined (the law of the subject of the Russian Federation), but the region has a choice of their number and subject of legal regulation. A comparative analysis showed that the constituent entities of the Russian Federation included in the Siberian Federal District use different approaches. In most of them, exemptions are established in several laws, each of which is dedicated to a separate regional tax. At the same time, there is an example of the establishment of tax exemptions by a single tax law. There are also examples of the introduction of additional tax exemptions for certain categories of taxpayers by independent regional laws, along with general tax exemptions established by the law on a specific tax. The author concludes that all indicated approaches do not contradict federal tax legislation. It is noted that earlier in the regions there was a practice of regulating the procedure for making a decision on the introduction of tax exemptions by separate laws, but today this issue is being resolved by assessing their effectiveness and is regulated at the by-law level, which does not contradict the procedure for establishing and introducing tax exemptions. Finally, it was concluded that a meaningful analysis of various approaches to establishing tax exemptions in the regions included in the Siberian Federal District did not reveal differences in the issue of internal systematization of tax exemptions, since they are set separately for each tax. However, in some regions there has been a tendency to systematize tax exemptions by categories of taxpayers. The use of various approaches is due to the goals of regional legal regulation and does not exclude further systematization of tax exemptions.

On the provision of excludable public goods: General taxes or user prices?

AbstractThis paper compares some of the most common ways of financing the provision of publicly provided impure public goods/services in a unified dynamic general equilibrium framework with heterogeneous income groups. The focus is on the effects of user prices on individual incentives and how the latter shape aggregate outcomes and distribution. We show that a market‐like mechanism of user prices not only improves individual incentives and enhances aggregate efficiency, but it is also Pareto improving. However, such a mechanism is not beneficial or simply collapses when social externalities are strong, when the government adopts a mixed system that combines user prices with heavy subsidization of user costs, and when there is a minimum amount of the good that everybody needs.

Deconstruction of Penal System Policy on Tax Law in Indonesia against Liability for Corporate Income Tax Evasion

The purpose of this study is to simplify legal policies in the Law on General Provisions and Tax Procedures by the values of Pancasila in technical and its implementation in the application of law and law implementation in tax crimes. Normative juridical research methods are processed qualitatively and descriptively, using sources of legal materials" secondary data" "primary" legal materials, and tertiary legal materials, laws, and regulations as rules or norms that become parameters of behavior. legal principles, as well as legal doctrines to answer growing legal issues. Such as the statute approach. Case approach, and conceptual approach. To achieve justice that is manifest in the imposition of criminal sanctions and can be implemented for perpetrators of tax evasion crimes, and focus on criminal purposes so that they can be held criminally accountable for their actions by the punishment given. The provisions in the special criminal law impose sanctions that are more severe than general crimes. At the same time as a consideration to answer the problem of how the deconstruction of the penal system policy on tax law in Indonesia against the criminal liability of corporate income tax evasion can be applied as a reference to make new legal constructions useful for the Indonesian state by deconstructing the diction or phrase of the criminal act of taxation and, technical management and separation of powers.

Overview of General Turnover Taxes and Tax Rates – January 2024

Almost all countries levy a general turnover tax, i.e. a tax on essentially all goods and services supplied by manufacturers, traders and service providers. Those turnover taxes are mostly levied under a VAT type of tax system and, in a decreasing number of cases, as a multi or single-stage (retail) sales tax. This article presents an overview of those general turnover taxes and the tax rates applicable on 1 January 2024.

No Rest for the Weary: Measuring the Changing Distribution of Retirement Wealth in the United States

ABSTRACT Since 1992 wealth for the bottom 90 percent of households nearing retirement has fallen. The only source of wealth helping the bottom 90 percent is Social Security. Despite pro savings policies and generous tax breaks for savings, the share of the bottom 50 percent having any retirement account didn’t change in 20 years — 46 percent in 1992 and 47 percent in 2016. Even the middle class suffered; the share of the next 40 percent with retirement savings fell from 85 percent in 1992 to a low of 71 percent in 2016. Housing ownership increased a bit for the bottom 50 percent but fell among the middle class and upper middle class. Home equity for the working and middle class fell. Using SCF and HRS data over 20 years, we find the bulk of working-class wealth is government social insurance. Economists should not exclude social insurance from wealth calculations. We find social insurance is the most important source of wealth for most families. Government policies and institutions have failed wealth building for most American households with workers.

BBC Funding: Much Ado about the Cost of a Coffee a Week

AbstractBBC funding (the licence fee model and the funding level) has been turned into a big issue out of all proportion to the low financial stakes—equivalent to the cost of one takeaway coffee a week for the whole household, excluding those with free TV licences. This article first proposes and explores three possible reasons for all the fuss: that licence payers take the BBC for granted, underestimating the value they get from it; that the attacks on BBC funding are part of a wider ‘war’ against it, driven by commercial or political vested interests; and that at least some of the criticisms of the licence fee reflect genuine, although much exaggerated, disadvantages. The article then evaluates four alternative funding models: advertising, subscriptions, general taxation and a universal household levy. It argues that the best long‐term model would be a flat, universal household levy, with exemptions for those least able to pay, as in Germany, with the funding level set by an independent body organised by Ofcom; and that, because the licence fee is becoming harder to sustain, this new funding model should be introduced at the start of the next BBC Charter in January 2028.

IT SECTOR TAXATION IN UKRAINE: FEATURES AND CURRENT TRENDS

IT SECTOR TAXATION IN UKRAINE: FEATURES AND CURRENT TRENDS

The effects of VAT reductions on newly built properties and constructions in Hungary

Motives: This study was undertaken to determine the feasibility and macroeconomic impact of reduced VAT. As an EU Member State, Hungary may apply reduced tax rates in accordance with the Council Directive 112/2006/EC. In Hungary, due to the high general tax rate, the range of products and services with reduced tax rates plays a special role.Aim: In Hungary, a preferential VAT regime was introduced to reduce the increase in the price of new-build properties. The aim of this study was to examine whether reduced VAT had the desired effect. Therefore, the effect of 5% VAT on the Hungarian real estate price index was analysed based on the data provided by the Hungarian National Bank with the use of various statistical methods.Results: The study demonstrated that a reduced VAT rate on newly built properties that meet certain conditions in Hungary had an impact on the real estate market. The date of the building permit, which is a prerequisite for applying a reduced tax rate, increased real estate prices as an immediate effect, which was reduced somewhat by the final consumer price due to the reduced tax rate. This double effect stabilised the real estate market price index.

Significance of economic openness for the origins of social insurance policies in the initial stage: a comparative study

ABSTRACT This article proposes an original perspective on the origins and formation of the modern welfare state, arguing that the openness of national economies had a critical influence upon the kind of social insurance policies each country would adopt before World War I. If we classify Western national economies into two typical types, the free-trade open economy (FOE) and the protectionist closed economy (PCE), depending on their trade policy, we can make two hypotheses. FOE, which is under heavy pressure from international competition, is more sensitive than PCE to the increase in employers’ cost. Therefore, hypothesis (1) is: PCE would precede FOE in introducing social insurance which involves considerable cost increases for employers. Hypothesis (2) is: if FOE dares to undertake a social insurance scheme, they would likely create social insurance that relies on general tax revenues to mitigate cost increases for employers. On the contrary, PCE can undertake social insurance schemes that involve considerable cost increases for employers more easily than FOE, as protective tariffs countervail their cost increases to some extent. Through the comparative analysis of all major Western countries, this article demonstrates the validity of these hypotheses.

Obligation to Submit Tax Data and Information From Agencies, Institutions, Associations, and Other Parties To Maintain The Authority of Law and The State

Law Number 28 of 2007 concerning the Third Amendment to Law Number 6 of 1983 concerning General Provisions and Procedures for Taxation and Government Regulation Number 31 of 2012 concerning the Provision and Collection of Data and Information relating to Taxation have regulated that every government agency, institutions, associations and other parties (ILAP), are obliged to provide data and information relating to taxation to the Directorate General of Taxes (DJP), the provisions of which are regulated by Government Regulations. Even though Article 41C of Law No. 28 of 2007 regulates a maximum prison sentence of 1 year and a fine of 1 billion for people who deliberately do not carry out obligations as regulated in Article 35A, in practice the provision of submission of tax data and information from ILAP does not work. properly. To realize the implementation of these obligations, the DJP took another approach through the creation of a Memorandum of Understanding/ Agreement/MoU to a Cooperation Agreement in order to obtain tax data and information from the ILAP. The research study used in writing research methods focuses on and examines the application of rules and norms in positive law. Using Legal Certainty Theory by Gustav Radbruch. The results of the research, what was found was that the implementation of the obligation to submit tax data and information from ILAP did not run in accordance with positive law, namely Article 35A of Law Number 28 of 2007 concerning the Third Amendment to Law Number 6 of 1983 concerning General Provisions and Tax Procedures. . Researchers suggest changes to norms in Article 35A of Law Number 28 of 2007 concerning the Third Amendment to Law Number 6 of 1983 concerning General Provisions and Tax Procedures to include a mechanism for signing a Memorandum of Understanding/Memorandum of Understanding (MoU). /Cooperation Agreement (PKS) as an alternative solution for collecting tax data and information so that legal and state authority can be maintained.

Weather derivatives: general overview, legal, tax, and application issues

Weather derivatives are exchange traded (ETD) or over-the-counter (OTC) call to option or swap contracts that are triggered in the specified weather event. Nowadays, acute weather events lead to increasing popularity of such risk hedging instruments. In this article the author presents a brief overview of the nature of weather derivatives, their applicability in various industries, available information on traded volumes, legal framework, taxation, pricing and basis risk, impact on financial resilience of investors. Comparing to the US market, weather derivatives are still not so commonly used in the EU. On the other hand, the obligatory implementation of new EU corporate sustainability standards and the underling TCFD (Task Force on Climate-Related Financial Disclosures) methodology will definitely increase weather risk awareness at least among large and public listed companies. Therefore, the growth of the demand for weather risk transfer tools is expected. In conclusion, next steps should be taken towards the improvement of the functioning of weather derivatives markets in response to the continuing trend of climate change.

THE IMPACT OF AN AUDITOR'S ADHERENCE TO THE PRINCIPLES OF NEUTRALITY, PROFESSIONAL INDEPENDENCE, PROFESSIONAL CONFIDENTIALITY, AND TRUST IN THE TAX ACCOUNTING PROCESS

Objective: This study aims to demonstrate the impact of the auditor's adherence to the principles of neutrality, professional independence, confidentiality and trust in the tax accounting process and the importance of this commitment to the tax administration. The study also examines the extent to which the tax administration relies on the auditor's report and financial statements in determining the taxable income of taxpayers.
 
 Methodology: The study's objectives were achieved by collecting data from a survey distributed to certified auditors working for the Iraqi Board of Accountancy and Audit, employees of the Federal Financial Control Bureau, and employees of the General Tax Authority. A total of 230 questionnaires were distributed, 200 of which were returned and verified for statistical analysis.
 
 Results: The results indicate a statistically significant positive effect at the 5% level for the impact of neutrality and professional independence on the tax accounting process. This means that an increased focus on auditor neutrality and independence will contribute to a 0.469 increase in the efficiency of the tax accounting process. In addition, there is a positive and statistically significant moral impact below the 5% level for the impact of professional duty of confidentiality and trust in the tax accounting process. In other words, ensuring auditors follow the rule of professional confidentiality and trust can improve tax accounting efficiency by 0.350.
 
 Conclusion: Professional ethics and codes of conduct serve as guides for auditors to exhibit appropriate professional behavior while performing their duties to meet society's ethical requirements. The professional code of ethics is the outcome of the profession's efforts to develop and organize rules. It assures the tax administration that the financial statements submitted by the taxpayer (companies) and approved by the auditor who adheres to those rules are truthful and fair.

General literacy and effective taxation system in Africa

ABSTRACT This inquiry provides empirical evidence on the effect of general literacy on tax revenue mobilization in Africa over the period 1996–2021. This evidence is important given the low level of taxation in Africa and the lack of clarity on the nexus between a country’s literacy level and taxation effort. The paper employs a simultaneous quantile regression, and uses three different indicators of tax revenue mobilization as a percentage of GDP. The motivation for quantile regression technique is primarily based on two essential reasons: (i) the argument that the effect of literacy on taxation effectiveness is dependent on the existing level of tax revenue mobilization; (ii) tax revenue mobilization policies, to be effective, need to be adapted differently across countries with low, intermediate, and high levels of existing tax mobilization effort. Results show that improvement in general literacy appears to promote tax mobilization effort, and that the effect of general literacy on taxation is stronger for direct taxes than for indirect taxes (in terms of both significance and magnitude). Furthermore, in most of the results, the impact of general literacy is slightly stronger in the upper quantiles of the general literacy distributions. The results remain robust over alternative econometric estimation techniques.

Norwegian perspectives on health care for people with intellectual and developmental disabilities

AbstractThe Norwegian health care system is built on individual rights and the principles of universal access, decentralization, and free choice of provider. Norway has universal health coverage, funded primarily by general taxes and by payroll contributions shared by employers and employees. Local authorities at the municipal level organize and finance primary health care services according to local demand and within national frameworks. Habilitation services are offered both in the primary health care and as a part of the specialist health services. They offer both inpatient and outpatient services for people with intellectual/developmental disabilities (IDD). National guidelines, known as Good health and care services for people with IDD, have recently (2021) been launched after various reports over the years of serious breaches and challenges in the health and care services provided to people with IDD.

Tale of a Missed Opportunity: Japan’s Delay in Implementing a Value-Added Tax

AbstractWhile a value-added tax (VAT), which supports a welfare state, was officially introduced in Japan in 1989, earlier attempts to implement this tax system failed. This study looks in-depth at why Japan was slower than other countries to implement a VAT. The tax authorities’ debates during the 1960s and 1970s are reviewed to understand why other attempts to introduce a VAT failed. Implementing the VAT would require a shift from the ideology centering on a direct tax to acceptance of indirect taxes and justification for a general consumption tax’s superiority over specific consumption taxes. Four influential factors are identified. First, in 1960, the ideology centering on a direct tax made a VAT inherently inferior. Second, in the 1968, “Break Fiscal Rigidification Campaign” created a revenue-neutral path for indirect tax increases but favored specific consumption taxes. Third, the Fundamental Issues Subcommittee conceptualized “high benefit/high cost” in the early 1970s and established the VAT’s superiority over specific consumption taxes based on a study of overseas travel to European Commission countries. However, the VAT was abandoned due to external shocks. Fourth, the attempts to link the VAT with fiscal reconstruction in the late 1970s faced strong opposition from consumers, small businesses, and the ruling party. Failure to introduce the VAT in the 1970s eliminated the possibility of using it to raise taxes in the early 1980s. The findings reveal that Japan’s failure to introduce the VAT closed a door to a “high benefit/high cost” type of Western-style welfare state.

ФІНАНСОВА І НЕФІНАНСОВА ЗВІТНІСТЬ ГАЛУЗІ ТУРИЗМУ УКРАЇНИ – НА ШЛЯХУ ДО ЄС

The aim of the research was the theoretical justification and improvement of the disclosure of financial and non-financial information of the subjects of tourism activity on the way to the harmonization of the legislation of Ukraine with the legislation of the EU. Tourist activities in Ukraine are carried out by: tourist operators and agents, as well as other business entities that are legal entities or may be persons – entrepreneurs. The determination of the type of business entity depending on the organizational and legal form and certain criteria according to the Law of Ukraine "On accounting and financial reporting in Ukraine" is the basis of the choice of simplified or full financial reporting and the right to a simplified system of taxation and accounting. Sole proprietorships who are on the simplified or general taxation system, employed in tourism, submit only tax reporting to the relevant authorities. Travel agents and operators registered as legal entities, which are micro or small undertakings, independently determine the feasibility of drawing up financial statements and decide which set to submit: simplified or full financial statements. The authors made a comparison of financial statements according to NR(S)A and EU Directives. The EU directive significantly simplifies financial reporting for micro undertakings. Ukrainian legislation requires more detailed information about the assets, liabilities and capital of a small business. However, the EU Directive recommends much more detailed data on the income and expenses of such enterprises in the profit and loss statement and separately in the notes. Large undertakings in the tourism industry publish financial statements according to International Financial Reporting Standards on their web page or website. In addition, large undertakings disclose financial and non-financial information about the business in the management statement. This is the first non-financial report that has become mandatory for Ukrainian large and medium-sized undertakings. The article discusses the disclosure of non-financial information in statements in accordance with the new EU Corporate Sustainability Reporting Directive, and the determination of the stages of introducing sustainable development reporting during 2024–2028. We believe that the presentation of data on social responsibility and sustainable development by tourism campaigns will have a positive effect on their investment attractiveness.

Examining the Role of Dimensions and Components of the Employee Compensation System in Explaining the Variance of Organizational Citizenship Behavior (Case Study: General Tax Office of Kerman Province)

Objective: The aim of this study was to examine the role of the dimensions and components of the employee compensation system in explaining the variance of organizational citizenship behavior (OCB) (Case Study: General Tax Office of Kerman Province). Methodology: This research was applied in purpose and descriptive-correlational in terms of method. Data were collected through standardized questionnaires. The compensation system questionnaire included four dimensions: managerial, organizational, psychological, and social. The OCB questionnaire included 15 dimensions, both using a 5-point Likert scale. The statistical population consisted of all employees of the General Tax Office of Kerman Province, and random sampling was used to select the participants. Findings: The results showed a significant and positive relationship between the dimensions of the compensation system (managerial, organizational, psychological, and social) and OCB. These dimensions simultaneously explained 39.5% of the variance in OCB. Moreover, psychological and managerial components had the greatest impact on OCB. Conclusion: This study demonstrated that the employee compensation system, particularly its psychological and managerial dimensions, has a direct influence on enhancing organizational citizenship behavior. Organizations that focus on improving their compensation systems can expect an increase in extra-role behaviors and greater employee participation. It is recommended that organizations pay special attention to designing and implementing fair and supportive compensation systems.