Increase In Tax Rate Research Articles

The state budget of Ukraine: Diagnostics in the context of martial law

At the current stage of development of a market economy, the efficiency of the state depends on the quality of budgeting and execution, as it is the main instrument for mobilising and spending public resources. The purpose of this study was to diagnose the revenues and expenditures of the State Budget of Ukraine under martial law, to identify the main problems that impede effective budget formation and execution, and to provide recommendations on how to eliminate them. The study used empirical, theoretical, and statistical research methods, namely description and comparison; synthesis, analysis, and generalisation. The paper examined the essence of the state budget according to the opinions of foreign and Ukrainian researchers. Based on the statistical data, the study described the current state of the state budget and analysed the dynamics of budget revenues and expenditures in 2018-2022. The structure of tax and non-tax revenues to the state budget was investigated. The structure of the state budget expenditures was analysed in terms of economic and functional classification. The budget deficit was analysed. The study highlighted the main problems related to the preparation and execution of the state budget, namely: military operations in the country leading to capital outflows; a decrease in the growth rate of the gross domestic product and a decline in production; insufficient filling of the reserve fund; an increase in tax rates leading to tax evasion by business entities; instability of the national currency; lack of an effective strategy for budget preparation and execution; imperfect control over the implementation of budget programmes. The paper offers recommendations on how to overcome these problems and promote optimisation of the revenue and expenditure sides of the state budget. The results of the study are of practical importance, since it is based on the analysis of the state budget indicators that the state of the budget is determined and ways to balance the revenues and expenditures of the State Budget of Ukraine are identified

Optimal tax enforcement with productive public inputs

We study optimal public expenditure and tax enforcement in a simple one-sector, dynamic endogenous growth model where agents optimize consumption and evasion; evasion is costly, while public expenditure increases private capital productivity. We show that tax evasion costs and the efficiency of endogenous audits play a crucial role in determining the relationship between tax evasion, tax rates, public expenditure, and growth. The key elements to improve tax enforcement are efficiency in the audit process and increased productivity in public expenditure. Increasing tax evasion costs could reduce tax evasion, but when tax enforcement is inefficient, this might trigger a perverse effect in which a tax rate increase reduces tax revenue. This finding implies that government spending depends on the efficiency of the audit process: expanding government expenditure optimally or increasing private productivity is impossible without improvements in tax compliance.

Delaying the Implementation of Carbon Tax in Indonesia: A Critical Review of the Harmonization of Tax Regulations

<em>The implementation of carbon tax has been postponed twice by the government based on the mandate of Articles 13 and 17 of Law No. 7/2021 on Harmonization of Tax Regulations. However, it is unclear how long these delays will last, raising questions about compliance with existing regulations. The postponement of carbon tax implementation based on existing regulations in the Harmonization of Tax Regulations raises concerns regarding compliance with the mandate of the law. The reason for the delay given by the government also needs to be further evaluated to ensure policy consistency and transparency in decision-making. This research aims to analyze the postponement of carbon tax implementation based on the regulations listed in the Taxation Regulations Harmonization Act, as well as identify the reasons for the postponement given by the government. This research method uses normative juridical, qualitative methods by reviewing literature, related rules, and regulations,Reasons for the delay given by the government include caution against a fragile economic recovery and a spike in energy prices. However, these reasons were also used to postpone the increase in the value-added tax (PPN) rate, potentially raising questions about compliance with regulations.</em>

OECD Ülkelerinde Vergi Açığının Ölçümü ve Vergi Açığı Bileşenlerinin Analizi: Panel Veri Yöntemi

Today, tax gap and measurement of tax gap is an important issue. In this study, in order to contribute to the literature, the tax gap of 35 OECD countries for the years 2005-2017 was measured. In the study, GDP, total tax rate and informal economy rates were used. The countries with the lowest tax gap rates are Luxembourg and Switzerland. The countries with the highest tax gap rates are Colombia, Greece and Costa Rica. In addition, the effects of GDP, total tax rate and informal economy rate on the size of the tax gap were examined. The data were tested by applying the panel data analysis method, cross-section dependency, unit root test and fixed effects models. According to the model's results, the informal economy rate increases the tax gap with the increase in the total tax rate and GDP. The tax gap, which exceeds the acceptable level, harms the economies. For this reason, it is very important that the tax gap remains at a controllable level. In this context, it is necessary to make legal arrangements in order to register the informal economy.

Consumption and voluntary savings response to service tax

PurposeThe purpose of this study is to find out the effect of consumption tax on savings behavior especially on the people who are close to their retirement.Design/methodology/approachThe authors analyze the response in spending and retirement saving using a difference-in-differences regression methodology. The authors use the year since the Public Provident Fund (PPF) enrollment date for each individual as a random assignment to identify the service tax policy's causal impact. Therefore, this variable is a continuous variable defined as an individual's age until the end of the restrictions when people can withdraw money from their retirement savings account PPF without any penalty. The treatment variable is the service tax shock (increase in service tax) that happened effective 1st April 2015.FindingsThe authors find a significant effect of a change in the service tax rate on individuals' spending and PPF saving behavior. On average, individuals lower their consumption by about 14% and increase their PPF savings by 16% in response to the increase in the service tax rate. The authors find substantial heterogeneity in effect across different types of individuals. The effect is more pronounced for people closer to their retirement and needy people (defined as individuals with low traditional savings account balances).Research limitations/implicationsThe authors studied the effect of consumption tax on one category of savings (PPF) only. There are other savings instruments available in India. The data for those were not available to us.Practical implicationsThis paper not only throws light on the consumption and savings behaviour of the individuals, but will also help the policy maker for framing appropriate fiscal policy.Originality/valueUsing a unique and proprietary data from a large bank in India, the authors analyze the effect of a tax policy change on households' consumption and retirement savings behavior. The authors find that households reduce their consumption by 14% and increase their voluntary retirement savings (Public Provident Fund aka PPF) by 16% in response to an increase in the service tax policy. Individuals close to their retirement age (55 years of age and above) and without any withdrawal restrictions from their PPF account tend to reduce their expenditures more and save more. Individuals with financial constraints and withdrawal restrictions do not reduce their expenditures significantly. To the best of the authors’ knowledge no study was done on this.

Can raising environmental tax reduce industrial water pollution? Firm-level evidence from China

This paper examines the effect of raising tax rates on reducing industrial water pollution, exploiting China's environmental tax reform in 2018 as a quasi-natural experiment. Based on micro-level data covering >19 thousand firms nationwide, we estimate that for every unit of tax rate increase, the emissions of water pollutants, Chemical Oxygen Demand (COD) and Ammonia Nitrogen (NH3−N) have fallen by 8.63% and 3.79%. High emission intensity firms reduce their emissions more than low emission intensity firms. We also document that state-owned enterprises are less responsive to the tax increase than non-state-owned enterprises. Our findings provide evidence that the increased environmental tax has contributed to significant reductions in industrial emissions in China.

Vertical migration externalities

State income taxes affect federal income tax revenue by shifting the spatial distribution of households between high- and low-productivity states, thereby changing household incomes and tax payments. We derive an expression for these fiscal externalities of state taxes in terms of estimable statistics. An empirical quantification using American Community Survey data reveals that the externalities range from large and negative in some states, to large and positive in others. In California, an increase in the state income tax rate and the resulting change in the distribution of households across states lead to a decrease in federal income tax revenue of 39 cents for every dollar of California tax revenue raised. The externality amounts to a 0.27% decrease in total federal income tax revenue for a 1 pp increase in California’s state tax rate. Our results raise the possibility that state taxes may be set too high in high-productivity states, and set too low in low-productivity states.

Universal basic income, time inconsistency and saving regret

We investigate whether a universal basic income (UBI) programme should replace New Zealand’s public pension system. A UBI programme would increase the number of social benefit recipients and hence increase tax rates. Not only the basic income itself but also its accompanying tax rate hikes would influence intra- and inter-temporal choices of households. We use an overlapping generations model and show that households’ preferences would be time-inconsistent—in hindsight, households regret having saved too little. There are three major findings of this study. First, the public pension system would be preferred to a UBI programme increasing the tax rate of income. Second, a UBI programme increasing the consumption tax rate would be preferred to the public pension system by households at most ages, but they would reverse the preference later in their lives. Third, a decrease in the population growth rate would make the reversal of the preference more noticeable.

Dynamic decision and its complex dynamics analysis of low-carbon supply chain considering risk-aversion under carbon tax policy

This study establishes a low-carbon supply chain game model under the centralized decision situation and the decentralized decision situation considering the manufacturer risk-aversion behavior, and discusses the influence of the manufacturer risk-aversion behavior on the optimal decision, profit, coordination, and complex dynamics of the supply chain. We find that comparing with the risk-neutral decentralized decision, the increase of manufacturer’s risk tolerance attitude can narrow the gap between the supply chain profit and the centralized decision, but it will further reduce the carbon emission reduction level. The increase of risk tolerance of the manufacturer and carbon tax will narrow the stable region of the system. Under this situation, the manufacturer should carefully adjust parameters to prevent the system from losing stability, especially the adjustment parameters for carbon emission reduction level. When the system is in a chaotic state, the increase of carbon tax rate makes the system show more complex dynamic characteristics. Under the chaotic state, it is difficult for the manufacturer to make correct price decision and carbon emission reduction strategy for the next period, which damages its profit, but increases the profit of the retailer and the supply chain. Finally, the carbon emission reduction cost-sharing contract is proposed to improve the carbon emission reduction level and the supply chain efficiency, achieving Pareto improvement. The stability region of the system is larger than that in the centralized decision situation, but the increase of the cost sharing coefficient will reduce the stability of the system in the decentralized decision-making situation.

Association of State-Level Tax Policy and Infant Mortality in the United States, 1996-2019

Infant mortality in the United States is highest among peer nations; it is also inequitable, with the highest rates among Black infants. The association between tax policy and infant mortality is not well understood. To examine the association between state-level tax policy and state-level infant mortality in the US. This state-level, population-based cross-sectional study investigated the association between tax policy and infant mortality in the US from 1996 through 2019. All US infant births and deaths were included, with data obtained from the National Center for Health Statistics. Data were analyzed from November 28, 2021, to July 9, 2022. State-level tax policy was operationalized as tax revenue per capita and tax progressivity. The Suits index was used to measure tax progressivity, with higher progressivity indicating increased tax rates for wealthier individuals. The association between tax policy and infant mortality rates was analyzed using a multivariable, negative binomial, generalized estimating equations model. Since 6 years of tax progressivity data were available (1995, 2002, 2009, 2012, 2014, and 2018), 300 state-years were included. Adjusted incidence rate ratios (aIRRs) were calculated controlling for year, state-level demographic variables, federal transfer revenue, and other revenue. Secondary analyses were conducted for racial and ethnic subgroups. There were 148 336 infant deaths in the US from 1996 through 2019, including 27 861 Hispanic infants, 1882 non-Hispanic American Indian or Alaska Native infants, 5792 non-Hispanic Asian or Pacific Islander infants, 41 560 non-Hispanic Black infants, and 68 666 non-Hispanic White infants. The overall infant mortality rate was 6.29 deaths per 1000 live births. Each $1000 increase in tax revenue per capita was associated with a 2.6% decrease in the infant mortality rate (aIRR, 0.97; 95% CI, 0.95-0.99). An increase of 0.10 in the Suits index (ie, increased tax progressivity) was associated with a 4.6% decrease in the infant mortality rate (aIRR, 0.95; 95% CI, 0.91-0.99). Increased tax progressivity was associated with decreased non-Hispanic White infant mortality (aIRR, 0.95; 95% CI, 0.91-0.99), and increased tax revenue was associated with increased non-Hispanic Black infant mortality (aIRR, 1.04; 95% CI, 1.01-1.08). In this cross-sectional study, an increase in tax revenue and the Suits index of tax progressivity were both associated with decreased infant mortality. These associations varied by race and ethnicity. Tax policy is an important, modifiable social determinant of health that may influence state-level infant mortality.

Dataset of companies' profitability, government debt, financial statements' key indicators and earnings in an emerging market: Developing a panel and time series database of value-added tax rate increase impacts.

Company profitability is a crucial indicator that can be used for developing and sustaining trust in accounting information and, thus, inefficient capital markets. Companies with good financial statements' key indicators have a more extensive customer base and can diversify their revenue streams, making them more resilient to economic downturns. Assembling and managing taxes is a critical underpinning to protecting a country's financial intensity and developing a country's tax-system. VAT is a primary source of financial gain in developing nations, which differs from economic income in developed countries, where economic income is primarily derived from tax income. In emerging economies, the existing practice requires firms to effectively and efficiently publish annual-reports and indicators on market-websites, as users rely heavily on timely-information and need it to make decisions. However, these practices fell short of expectations, requiring more research. These variables are crucial for most accounting/economics/taxation research models and the lack of easily attainable data in well-known databases (e.g., ARGAAM; DataStream). This article is primarily a dataset for analysing taxation, performance variables, and key financial-statement indicators. The data describes the raw, combined, and filtered information at the company level, such as company profit and government debt in Saudi Arabia. It combines a firm-level panel dataset sample of company profit that its measures scaled by total assets and include: earnings before interest, taxes, decrease and amortisation, earnings before interest and taxes, earnings after taxes and earnings before taxes-moreover, the time series dataset sample of 11 financial statements' key indicators. The dataset results from 494 company-year observations (226-panel data sample and 268-time series data sample) from 2019 to 2020. Data has been collected from taxation reports, corporate annual reports, ARGAAM database, FinBox database, the Trading Economics database and the Tadawul-market website in Saudi Arabia.

Universal Basic Income Programs: How Much Would Taxes Need to Rise? Evidence for Brazil, Chile, India, Russia, and South Africa

Using microsimulations this paper analyzes the poverty and tax implications of replacing current transfers and subsidies by a budget-neutral (no change in the fiscal deficit) universal basic income program (UBI) in Brazil, Chile, India, Russia, and South Africa. We consider three UBI transfers with increasing levels of generosity and identify scenarios in which the poor are no worse off than in the baseline scenario of existing social transfers. We find that for poverty levels not to increase under a UBI reform, the level of spending must increase substantially with respect to the baseline. Accordingly, the required increase in tax burdens is high throughout. We find that the increase in the average tax rate that would be consistent with not hurting the poor is almost universally above 30%, limiting the feasibility of a UBI reform due to political resistance and efficiency costs.

ACCUMULATION AND USE MANAGEMENT BUDGET RESOURCES

The article examines the theoretical aspects of managerial research on innovation policy and strategy of the business entity. It is substantiated that innovative management is focused on organizational and economic models and methods of managing all stages and types of innovative processes in the subject of economic activity with maximum effectiveness and efficiency. It has been proven that the possibilities of forming a complex innovation management system depend on a significant number of factors. It has been found that determining the need and possibility of managing innovative processes in a business entity allows identifying its real needs, and they can be divided into the needs of the external environment, the needs of the internal environment, and the actual needs of the innovation process as an independent object of management. It is proven that in the conditions of global challenges, the formation of the strategy of the business entity should be aimed at solving the tasks of prospective production and technological development. This type of development is, in fact, a versatile, multifaceted activity that covers almost the entire internal economic environment of the subject. It is substantiated that the innovation strategy is the most important link of the subject’s economic strategy and determines its content and direction in many cases. The stages of formation of an innovative strategy of a business entity are defined. A model of formation and implementation of an innovative strategy of a business entity has been developed. It has been proven that the strategic management of innovations of a business entity consists in the timely concentration of efforts on the development and use of promising achievements of scientific and technical development and the timely provision of resources for the dynamics of innovations for the benefit of the achievement of the goals of the business entity and the creation of conditions for its long-term effective activity. Methodology. The methodological basis of a scientific article is a set of tools, which includes methods of scientific knowledge, analysis and synthesis, systematization and scientific abstraction. The scientific basis of the conducted research is the scientific development of Ukrainian and foreign scientists in the field of managing the accumulation and use of budgetary resources. Results. It is substantiated that the rate of economic growth, increase in the welfare of the population, the level of domestic production, competitiveness and the development of international partnership depend on the efficiency of the management of the state’s budgetary resources. The main priorities of the budget in the difficult period of martial law are determined to increase the state’s defense capability and ensure social stability in society, which requires stable revenues to the budget. The Government is considering amendments to legislative acts to improve the efficiency of management decision-making regarding the implementation of the State Budget of Ukraine. The state at the initial stage of the full-scale war introduced a number of fiscal incentives to support the economy and consumption. However, the duration of the war and the significant growth of the budget deficit led to an increase in the fiscal importance of taxes and fees. In view of the above, fiscal consolidation measures were applied, which led to an increase in budget revenues. It is important to support the public’s intentions of state institutions to increase tax rates to increase the financing of the military. Approaches to increasing the effectiveness of the country’s budget formation mechanisms in wartime conditions should be based on the institutional interaction of fiscal and monetary regulators. Currently, international support plays an important role in stabilizing the economy and financing the state budget through the provision of loans, loan guarantees and grants. Practical importance. Conducted management research will support the process of managing the accumulation and use of budgetary resources.

External public debt of the Russian Federation: risk assessment and improvement of the management system

This scientific article deals with issues related to risks arising from external public debt. The authors of the article note that the state's own resources and funds do not always allow satisfying the country's unlimited needs, so borrowing from abroad becomes necessary. One of the reasons why states are forced to resort to external borrowing is the problems associated with financing budget expenditures. In today's realities, it is very important to rationally approach the issue of managing external debt, because its cancellation can seriously affect the future stability and ensure the country's national economic security. The growth of the external debt of the state, according to the authors, can lead to an increase in tax rates, diversion of funds, economic recession, inequality between people, as well as the transfer of debt to subsequent generations. Consequently, the external debt management policy is designed to enable the state to attract funds from other sources, solve social problems and ensure economic security. According to the authors, external debt is an essential link in the macroeconomic system of any country, because it affects public finances, the investment climate, money circulation and international cooperation. Those relationships that develop during the formation and repayment of debt can significantly affect the long-term economic potential of the country. In this regard, the authors note that it is necessary to conduct a comprehensive policy of the state in relation to external debt and balance its income and expenses so that there is no need for borrowing from abroad, and so that a situation does not arise in which external debt becomes the most serious obstacle to difficult path of economic transformation.

Macroprudential regulatory policies with a dominant-bank oligopoly and fringe banks

This paper develops a model in which a handful of dominant banks mutually engage in head-to-head rivalry while acting as loan-quantity-setting leaders vis-à-vis numerous fringe banks. Under the most likely calibration of parameters governing behavior of the two groups, we find that increases in capital requirements substantially reduce equilibrium loan volumes and raise the market retail loan rate, while increases in tax rates tend to raise the market loan rate but not in a way that significantly alters aggregate lending. Key parameters influencing outcomes in alternative calibrations are the number of dominant banks and the market loan demand elasticity.

The Accounting and Fiscal Regime of Dividends in 2023

The Government Ordinance No. 16/2022 has some novelties with regard to the tax treatment of dividends. Thus, starting with the 1st of January 2023, the dividend tax rate increases from 5% to 8% for the dividends paid to legal persons and to resident/non-resident natural persons, as well as to privately administered pension funds and to the optional pension funds. As an element of novelty, the Government Ordinance No. 16/2022 brings a series of clarifications regarding the conditions that must be fulfilled in view of applying the exemption of dividend payments made by a Romanian legal person to another one, with regard to the form of organisation and the application of the profit tax or of another tax which replaces it, without the possibility of an option or exemption. Besides the increase of the tax rate, the Government Ordinance No. 16/2022 also brings changes with regard to the health contribution rules for the dividend incomes. Thus, starting with the incomes corresponding to 2023, the payment obligation of the health contribution for the dividends collected by the natural persons appears from the six minimum salaries ceiling, compared to the 12 salaries ceiling in the previous year. While the dividend tax is applied according to the year of their distribution, the health insurance contribution is applied by taking into account their actual collection date. If the dividends are distributed during 2022, but are paid in 2023, the taxation rate is kept at 5%, but the health insurance contribution falls within the rules from the year of their collection. The distribution of dividends can be made annually, after the approval of the annual financial statements corresponding to the ended financial year, or quarterly, throughout the year, after the approval of the interim financial statements. Law No. 370/2022 clarifies the fact that, in case the company decided to distribute dividends based on the interim financial statements prepared during 2022, the 5% taxation rate is kept, without recalculating the tax on the respective dividends after their regularisation based on the annual financial statements corresponding to the financial year 2022, approved according to the legal regulations.

Growth aspiring entrepreneurs’ response to corporate tax rates: Is it universally negative?

The article challenges the universal assumption in the literature that corporate tax rates constrain growth-aspiring entrepreneurs. The strength of financial intuitions may be a stronger predictor of growth aspirations than corporate tax rates. With the support of strong financial institutions, countries possessing norms supportive of individual success and risk-taking will lead growth-aspiring entrepreneurs to persist in the face of corporate tax rate increases. For countries with weak financial institutions, it does not matter whether norms are supportive or not of individual success and risk-taking behaviour; entrepreneurs do not have the means to grow their enterprises and thus do not show a strong response to corporate tax rate increases. This argument is supported by an analysis of 394 country-year observations for 77 countries from the GEM and World Bank databases. The study contributes to understanding the contextual conditions required for growth-aspiring entrepreneurs to overcome tax constraints and, more broadly, formal institutional constraints. Our qualifying condition in performance-oriented norms points to the importance of informal institutions in promoting entrepreneurial resilience and persistence. This also points to the importance of the interdependency between formal and informal institutions when explaining economic behaviour.

Port Competition through Hinterland Connectivity—A Case Study for Potential Hinterland Scope in North Rhine-Westphalia (NRW) Regarding an Environmental Policy Measure

Comparable port efficiency among ports of the European northern range leads to a competitive shift toward hinterland connectivity. North Rhine-Westphalia (NRW), having a high population and industry density and an extensive road, rail and waterway network, is prone to such inter port competition due to its proximity. Using a simulation model, the potential hinterland scope by each port and mode in NRW is depicted and a sensitivity analysis with increasing carbon tax rates is conducted. With an increasing tax rate, the scope for central areas of NRW, prone to a shift to rail transport, expands and become heavily contested among multiple ports. A major profiteer of an increase is projected to be the Port of Rotterdam due to its good connectivity at the cost of Antwerp. The market share of German ports is likely to stay the same with a mode shift occurring. Policy measures like a carbon tax not only have an effect on environmentally friendly mode shift but can severely impact the competitive situation of infrastructure components. While achieving the primary goal of transport sustainability, national interests might mandate the economical existence of a functioning maritime port, which leads to the consideration of additional measures when increasing carbon tax rates.

ANALISIS KEBIJAKAN PEMERINTAH KOTA MALANG TERKAIT ANCAMAN PENGANGGURAN PASCA KENAIKAN INFLASI

One indicator of the cause of inflation is. Inflation and Unemployment have a role in making fiscal and monetary decisions of a country in improving its economic conditions. The purpose of this study is to analyze policies related to the threat of risk after the increase in inflation in the city of Malang. The data processing technique used in this research is qualitative, which is done by collecting the data that is roughly needed. The results revealed that the highest number of expenses in Malang City in 2021 with a total of 63.531, while the lowest number in 2019 with a total of 40.104. The highest amount of inflation in Malang City is in 2014, while the lowest inflation is in 2020. Fiscal policies that can be implemented the government in reducing the levels of movement, namely opening up job opportunities, adding State-Owned Enterprises, and creating job training centers to overcome the impact of inflation the government can make policies; reducing unexpected spending, offering support for 2% of the general allocation fund, increasing tax rates and providing maximum prices for certain goods.

Does land conservation raise property taxes? Evidence from New England cities and towns

Protected lands provide high ecological and social value, yet a perception that land protection erodes local property tax bases and shifts tax burdens to other owners creates barriers for new protection. We investigate the impact of land protection on local property tax rates using panel data from more than 1400 towns and cities in New England between 1990 and 2015, including both ownership and easement-based protection. We find that on average, new protection results in a small increase in annual tax rates, with an expected change of $0.0231 per $1000 of value for a 1 percentage point increase in the percent of municipal area protected. This corresponds to an increase in a homeowner's annual property tax bill of $1.16 per $100,000 of value for 100 acres of new land protection. We do not find that taxes continue to increase over time or reduce municipal expenditures. However, for towns that are growing slowly, have lower household incomes, or use municipal land protection, we estimate greater tax bill increases of up to $10 for each $100,000 of value. These results provide evidence that land protection does not have a substantial impact on property taxes, but also highlight the importance of maintaining and expanding public compensation mechanisms, such as payments in lieu of taxes, where expected burdens from new protection may be greater.