Impact Of Tax Reform Research Articles

The impact of tax reform on corporate green transformation — Evidence based on the value-added tax retained rebate

This paper empirically investigates the tax system reform as an important factor driving corporate green transformation. Empirical results indicate that government's implementation of a tax system reform, mainly based on the value-added tax (VAT) retained rebate, can significantly enhance the level of corporate green innovation and promote corporate green transformation. Further research reveals that the promoting effect of the tax system reform on corporate green transformation is more pronounced in non-state-owned enterprises and in companies with high financing constraints. Overall, the research results have significant practical implications for further improving corporate resource allocation and fostering new competitive advantages for companies.

The impact of tax reforms on human development index: Literature review approach

AbstractHuman development is an important variable in entrepreneurial activities at all levels both nationally and internationally. In any country, the meaning of human development, which is associated with progressiveness in people's life status, is to be evaluated based on people's livelihood. The government is the core institution responsible for human development in any country through financing, coordinating, and supervising different human development projects. Such development projects include the provision of quality public goods and services such as health, education, housing, and other welfare schemes; all necessary infrastructures relating to the provision of such services like schools and hospitals; and respective experts to facilitate such services like teachers, doctors, and nurses, etc. Tax is regarded as an important tool for governments not only for revenue generation but also for achieving various social and economic reforms for individuals and the economy as a whole, both in developed and developing countries. Most of the current economic discussions from the country level to the international level are about human development, with taxation as the main tool. Thus, economic reforms including tax policies are also made for poverty reduction and other purposes. Among policies include progressive taxation and credit approach; establishment of specific taxes and specific revenue pools for improving human development and reducing inequality; and eliminating tax exemption and reliefs in fighting against poverty.

Impact of Tax Reforms on Revenue Generation in Anambra State: An Empirical Evidence from a Time Series Approach

Impact of Tax Reforms on Revenue Generation in Anambra State: An Empirical Evidence from a Time Series Approach

The Impact of Tax Reform, Subjective Norms and Social Norms on SME’s Tax Compliance during the Covid-19 Pandemic

This study aims to determine the direction of tax reform, subjective norms and during social norms on SME tax obligations of SMEs in DKI Jakarta Region during Pandemic Covid-19 collected by questionnaires. Result shows partial taxation reforms and social norms have a positive impact on SME tax obligations, but subjective norms are not related to SME tax obligations. In addition, tax reform , subjective norms, and simultaneous social norms are positive for taxpayer compliance. This finding would be useful for DGT for brainstorming references of SME’s policy and tax strategy.

The impact of tax reform on firms' digitalization in China

Digital transformation is continuous and costly, thereby posing a challenge to the stability of firms' cash flow. Tax cuts are conducive to improving cash flow condition. This study examines the impact of the business tax to value-added tax (BT to VAT) policy on digital transformation by using data of listed firms in China from 2007 to 2019. We measure the degree of firms' digitization by textual analysis and find that the BT to VAT policy significantly promotes the digital transformation of firms. Our results remain robust after several robustness checks. Heterogeneity analysis shows that the driving effects of the BT to VAT policy on digital transformation are considerably pronounced for high-tax-burden, low-profit, and non-state-owned firms; firms with high financing constraints; and firms located in the eastern region. Lastly, this study examines the potential mechanisms. Findings suggest that the tax cut effects of the BT to VAT policy enable firms to undertake digital transformation. We also find that digital transformation strengthens firms' competitive performance, thereby possibly further enhancing the willingness of enterprises to pursue digital transformation.

Impact of tax reforms on revenue mobilisation in developing economies: empirical evidence from Ghana

PurposeThis paper assesses the impact of tax reforms on tax revenue mobilisation in Ghana.Design/methodology/approachThe autoregressive distributed lag model together with dynamic ordinary least squares and fully modified least squares techniques were employed on a time-series data spanning from 1980–2018. Exploiting data from IMFs monitoring of fund arrangements database, an index of tax reforms is constructed as a function of the number of successfully implemented tax-related reforms and policy measures per year over the study period.FindingsHaving established the presence of co-integration between tax revenue and its determinants, this paper finds strong evidence that tax-related reforms exert positive and significant impact on tax revenue generation in Ghana. Among other covariates, the results show that the tax base (real GDP), public debt and education (human capital index) significantly boosts tax revenue in the long run.Originality/valueThe success of tax reforms in boosting revenue mobilisation has been examined in light of the buoyancy and elasticity of the tax system in Ghana, albeit with little emphasis on the extent to which tax reforms contribute to tax revenue mobilisation from econometric perspective. This paper fills this gap in the literature by analysing the impact of tax reforms on tax revenue mobilisation in Ghana. As a recommendation, well-designed and implemented tax reforms and policies aimed at increasing the tax base, education and effective utilisation of funds from public debt promise to be instrumental in boosting tax revenue in Ghana.

The Impact of Tax Reform in Slovakia on Creation of Profit in Companies

This paper examines the relationship of tax policy of state and the creation of profit in selected tax subjects. The aim of paper is in the context of more than a decennial development of economy of Slovakia to verify and to the numerical rich material to show whether the tax reform in 2004, which was declared as pro-business oriented by then government, significantly affected the financial results of companies.

Impact of Tax reforms in Government of Indias Indirect Tax Collections with Special Reference to Year 2000-2020

Abstract: In this paper, an attempt has been made to analyse the implications of tax reforms after the economic liberalization in 1991 with respect to collection of indirect tax revenue of the Government of India during the last two decades (2000-20). The composition of indirect tax revenue of the Government has undergone a drastic change during the last two decades. Post implementation of the GST Act, the levy of Central Excise has been restricted to petroleum and tobacco products and GST has evolved as the major contributor to the indirect tax revenue collections followed by the Customs Duty. Comparative analysis of indirect tax collections of the Central Government with respect to its growth, share in gross tax revenue, percentage of GDP and composition has been done for the period from 2000-01 to 2019-20. The current study has revealed the growth rate of indirect taxes has not only been uneven but also declined during the year 2001-02, 2008-09 and 2009-10. The share of indirect tax in the gross tax revenue has also gradually declined from 63% in 2000-01 to 46% in 2019- 20%. The indirect tax-GDP ratio has remained stagnant in the range of 3.5 to 5.5 % during the last two decades.

Role of financial literacy and awareness of tax impacts in an emerging economy facing tax reform

This study seeks to assess the levels of financial literacy based on demographic characteristics of residents in Bogotá, capital of Colombia. Given the massive public demonstrations against tax reforms that have been taking place in large cities in Colombia in 2021, this paper analyses the knowledge of people of the nature and impact of tax reforms, especifically their financial understanding of the impact of these fiscal policies. Utilizing regression analysis with a quantitative and qualitative research design, the article investigates the degree of financial literacy and the relation between the financial knowledge and the current orientation in tax policy changes and their impact on the population. The data used in this study was gathered from 6,713 households in Bogotá and supplemented by in-depth interviews of representatives of each demographic group selected by careful sampling to represent each demographic characteristic. The results are structured in two parts, firstly, based on the analysis of three variables measuring levels of financial literacy of individuals relating to the interest rate, inflation and the principle of risk diversification. Secondly, qualitative research added two questions on knowledge of tax reform. Logistic regression was used. Results of both qualitative and quantitative research show that there is significant difference in the financial knowledge of people of different age, marital status and education. Interviews showed the best awareness and orientation in the mid-age group, predominantly men, who are seen as leaders. The most vulnerable group is low-educated single women. Limitation of the study is the narrow focus on households in one city. This article provides an insight into the importance of financial literacy, its monitoring, implementation of continuous improvement based on feedback loop in an economy in transition.

Impact of Tax Reforms in Applied Models: Which Functional Forms Should Be Chosen for the Demand System? Theory and Application for Morocco

When researchers and policymakers conduct impact analyses of economic reforms, especially fiscal reforms, the specification of the household demand system becomes crucial. There is a trade-off between using demand systems simple to manipulate but less realistic and other systems that are more realistic but often more complex and difficult to estimate or calibrate. In this paper, we compare the results from two different demand systems: a simple one, the Cobb- Douglas (CD), and a more complex one, the Constant Difference Elasticity (CDE). We develop an hybrid method of estimation - calibration based on the estimation of the parameters and elasticities of a QUAIDS system and on the calibration of those of the CDE system using a cross-entropy approach. The estimates obtained are introduced into a micro-simulated partial equilibrium model to approximate the impact of the VAT reform on poverty measures in Morocco. We show that when the simulated shocks are moderate, the gain of using a CDE system instead of a CD system is marginal but, when these shocks are stronger, the differences become significant and increase. Then the use of these models can lead to different results when evaluating public policies and their impacts on poverty measures.

Litigios entre sujetos y cabeceras y la elaboración del Mapa de Coatlichan

La realización del Mapa de Coatlichan al parecer fue determinada por factores múltiples. Entre estos figuran una creciente presión territorial por parte de numerosos colonos españoles que solicitaron mercedes de tierras en los términos de Coatlichan, el avance de la mortandad de los indígenas debido a las epidemias y los efectos de las reformas tributarias en la dinámica del trabajo. Todo junto desestabilizaría la estructura político-territorial del señorío de Coatlichan, produciendo que ciertos sujetos pugnaran por convertirse en estancias con cajas de comunidad.En este trabajo se proponen algunas locaciones documentadas, como los referentes de los topónimos del Mapa de Coatlichan.

2018. gada nodokļu reforma uzņēmēju vērtējumā

Economic development in the country is characterized by the growth of gross domestic product, and in Latvia it is 2.1% at the beginning of 2019. Economic development must be closely linked to the business environment, and one of its most important factor is the fiscal policy of the state and its tax system. In 2018, the tax system reform was implemented in Latvia, where significant changes were made in the taxation and methodology of its calculation. This study analyses the University Turiba Survey of Entrepreneurs conducted in 2018 and 2019, explaining the entrepreneurs’ opinion on the impact of tax reform on business environment in Latvia and the amount of taxes paid by companies. In 2019, 92% of respondents believe that the taxes for businesses are too high, demonstrating their dissatisfaction with the existing tax rates and methodology. In 2019, the business environment has been rated as good by 44% of the respondents, compared with a rise of about 10 percent in the previous year.

The role of capital taxation on the business cycle: the case of Chile, 1960–2019

How relevant could capital income tax be as a growth engine? We analyse the Chilean experience that since the mid-80s has shown significant increase in its growth rate, outperforming most Latin American countries in the same period. This paper analyses the contribution of capital stock to the Chilean business cycle from 1960 to 2019. We do so by constructing a dynamic general equilibrium model in which firms accumulate capital and capital income taxation occurs at both firm and individual levels. In line with previous studies, we find that productivity shocks were an important driver of growth but unlike them, we find that capital income taxation policies also played an important role in explaining the Chilean miracle. The large adjustments in capital stock that Chile experienced are in line with the reasoning that interest rates in small open economies like Chile respond less to increases in capital taxation, and therefore do not diminish the impact of tax reforms.

The Impact of Goods and Services Tax (GST) on Fast Moving Consumer Goods (FMCG) Consumers with respect of Personal care Products

Goods and Service Tax (GST) is an indirect tax which is levied on the purchases of goods and services. The tax is levied at each level of production and distribution process until goods delivered to final consumers. Therefore, GST helps to detect tax evasion easily. Despite of benefits, certain drawbacks are occurred due to the introduction of GST. Hence, this study has investigated the impact of tax reforms with reference to GST (Goods and Services Tax) on FMCG consumers. Primary data was considered for this study. For collecting the data questionnaire was framed and distributed among 400 respondents. The data analysis reviled that 60% of the respondents strongly agreed that after implementation of GST affects the spending behavior and 59% of the respondents strongly agreed that GST has a negative impact on the price of personal care product. Hence, this study provides the information about the impact of Goods and Services Tax (GST) on fast moving consumer goods with respect to personal care products targeting lower income people and lower-middle-income people.

Assessing the Impact of Tax Reforms on the Long-Term Sustainability of Public Finances

The article is devoted to the methodological aspects of assessing the impact of tax reforms on the sustainability of public finances. The low impact of numerous tax changes during 2003–2017 in Ukraine aimed at reducing the tax burden, improving the investment climate, led to a narrowing of fiscal space, a decrease in government investment, and a curtailment of enterprise investment. The problem of assessing the direct and indirect effects of tax reforms in terms of changes in tax rates and tax base, tax revenue structure, tax benefits, on public finances and the finances of economic entities in the short and long term remains insufficiently investigated. The task is to identify the relationship between tax policy changes that are taking place within the framework of tax reforms, the economic behavior of economic entities, and their impact on the sustainability of public finances.
 The article identifies trends in the development of taxation in the EU, which create the conditions for activation of the factors of development of innovative, competitive economy, in particular, the reduction of corporate income tax rates and personal income tax while expanding the tax base, increasing consumption taxes on property. The methodological support of the assessment of tax reforms of EU countries is summarized and the conclusion is made about the possibility of its application in Ukraine. Changes in the share of various taxes in the total amount of tax revenues are analyzed. The reasons and the financial consequences of the tax effects in Ukraine established in the EU countries were found to be associated with a reduction in corporate income tax rates and a compulsory social contribution (lower rates do not reduce tax revenues and increase the budgetary income in the medium term). Indicators and models that can be used to assess tax reforms aimed at improving tax competitiveness (reducing tax rates), as well as reforms to ensure economic growth (redistribution of tax burden and tax incentives - tax innovation benefits) are identified. It is proposed to supplement this list with indicators: the level of investment of the institutional sectors of the economy, the investment rate, the level of profitability, the global innovation index.
 Proposals on adjusting the directions of tax development in Ukraine have been elaborated.

The Impact of Tax Reforms on the Behaviour of Economic Agents (Indirect Taxation in Russia and the USA)

The “turnpike hypothesis” proposed in this article suggests that the trajectory of GDP growth rates is a “turnpike”, which attracts tax revenues of any type. A significant deviation of the rates of tax revenue growth from the turnpike means that this tax has grown unresponsive to the dynamics of the global tax base – GDP. To test this hypothesis, the authors introduce the indicators of surplus return and volatility of tax revenues, which leads them to narrowing the definitions of such terms as budget orientation and efficiency of taxes. To analyze the behaviour of economic agents, the authors construct econometric dependencies of three indirect taxes (VAT, customs duties and excise taxes) on the tax rate (tax burden), GDP and the population income. For the VAT, the tax burden was its nominal rate; for excise taxes, the share of excise taxes in the retail turnover; for customs duties, the share of customs duties in the foreign trade turnover. The resulting models were used to calculate the elasticity of tax revenues, GDP and population incomes with respect to the tax burden, which is equivalent to the analytical expression of the way the three participants of the economic system – state (public budget), producers (business) and consumers (population) – react to the tax burden. To analyze the analytical coefficients and econometric models, the authors used the statistical data of Rosstat for Russia and of the OECD for the USA for the period between 1995 and 2017. The calculations show that the Russian and American tax systems contain taxes that are “insensitive” to economic growth. In Russia, these include the natural resource extraction tax, customs duties and contributions to extra-budgetary funds, and in the USA, excise taxes, property tax and customs duties. The study shows that the Russian economic crises in 2008 and 2014 had a remedial effect on the country’s tax system and helped it get closer to the turnpike of economic growth. The model calculations of the three kinds of elasticity showed that an increase in the VAT tax rate reduced the activity of the three participants of the economic system while an increase in the excise or customs duty burden, on the contrary, enhanced their activity. The conclusion is made that the turnpike hypothesis is confirmed for the majority of taxes both in Russia and the USA. It is also shown that those taxes for which the hypothesis is confirmed only partially are in urgent need of reformation. For citation Balatsky E. V., Ekimova N. A. The Impact of Tax Reforms on the Behaviour of Economic Agents (Indirect Taxation in Russia and the USA). Journal of Tax Reform . 2019;5(2):129–147. DOI: 10.15826/jtr.2019.5.2.064 Article info Received June 24, 2019 ; accepted July 21, 2019

The Impacts of Tax Reform on Agricultural Households

AbstractEstimates of tax reform's impacts usually concentrate on macroeconomic impacts, but attention at the industry or sectoral level is often limited. Our study uses a computable general equilibrium (CGE) model to estimate the disaggregated impacts of the Tax Cuts and Jobs Act (TCJA) of 2018, which lowered personal and corporate tax rates. Focusing on agriculture, we use survey data to calculate how the TCJA would change the tax rates faced by farmers at the sector level. We use Internal Revenue Service data to calculate tax rates for all other producers. We then simulate the economy‐wide and sectoral effects of TCJA. We find that the TCJA would cause a reduction in agricultural output as resources would be reallocated to other sectors. Using our survey data, we extend the CGE results to measure the impacts to farm households—from changes in on‐ and off‐farm income. We find that most farm households would have income gains from tax reform. Our tax reform scenario highlights the fact that investment weighs heavily on model results. That is, firms that are attractive to domestic and foreign investment have gains in demand for their products, while other sectors, such as primary agriculture, experience decreases in production. A sensitivity analysis that reduces the attractiveness of the United States in foreign investment shows smaller impacts of TCJA, especially for macroeconomic variables.

Taxes, Capital Structure Choices, and Equity Value

We use a multitude of tax reforms across the Organisation for Economic Co-Operation and Development (OECD) countries as natural experiments to estimate the market value of the tax benefits of debt financing. We report time-series evidence that tax reforms are followed by large changes in the value of corporate equity. However, the impact of tax reforms is greatly mitigated by the presence of leverage. The value of debt tax savings is greater among top taxpayers, among highly profitable firms, and in countries where tax laws are more strongly enforced. Importantly, the value of debt tax savings is in line with the benchmark implied by a traditional approach.

The Impact of Tax Reform on the Hospitality Sector: Some Evidence of the Republic of Croatia

In this paper authors argument that the increase in VAT for restaurant/catering services will have negative influence on the tourism sector and consequently slow Croatian economy which is heavily dependent on tourism. This increase will negatively influence the price competitiveness and the overall competitiveness of the tourism sector. According to the latest Travel and Tourism Competitiveness Report 2015, Croatia has been ranked 33 rd out of 141 countries (scoring 4.3 of 7). Looking at the price competitiveness pillar which measures how costly it is to travel and invest in the country, Croatia has been placed on 101 st place. Claiming that business operating in the catering industry did not take advantage of the preferential (lower) VAT rate of 10% (01/01/2013) and 13% (01/01/2014) to increase its competitiveness cannot be accepted. The employment cycle in the tourism sector began with the targeted VAT relief on catering services in 2013. The research results have shown the existence of strong correlation between accommodation and catering services, particularly when it comes to the creation of new jobs and protection of existing ones. Delving into the relationship between taxation and the profit margin, authors conclude that Croatian businesses operating in the restaurant and catering industry do not have space to amortize shocks derived from the increase of VAT tax to 25%. The only way to amortize shocks would be the price increase or the decrease of product/services quality. This can only result in the loss of the competitiveness of the tourism sector.

Tax-reforms, normal and actual working hours and welfare in the beginning of the 20th’s Denmark

We estimate a labor supply function and the impact of tax-reforms on men and women’s labor supply using normal and actual working hours. The data stem from the Danish Time-Use Surveys in 2001 and 2008/09 which include information from stylized survey questions and time-use diaries. The results suggest that the wage-rate effects are larger when using normal working hours compared to actual working hours, and that income effects are less sensitive to working hour measures. We also find that the associations between marginal tax rate and normal and actual working hours are smaller for men and women satisfied with their leisure time than for unsatisfied men and women. Lastly, an increase in the normal labor supply was greater for the tax-reform treated group than for the control group, while increase in the actual labor supply was smaller for the treated group. The last findings are not significant, however, probably due to a small number of observations.