Tax Rates Research Articles

Impact of Carbon Tax on Renewable Energy Development and Environmental–Economic Synergies

Global warming caused by greenhouse gas emissions has become a worldwide environmental problem, posing a great threat to human survival. As the world’s largest emitter of carbon dioxide, China has pledged to reach peak carbon emissions by no later than 2030 and carbon neutrality by 2060. It is found that a carbon tax is a powerful incentive to reduce carbon emissions and promote an energy revolution, but it may have negative socio-economic impacts. Therefore, based on China’s 2020 input–output table, this paper systematically investigates the impacts of a carbon tax on China’s economy, carbon emissions, and energy by applying a computable general equilibrium model to determine the ideal equilibrium between socio-economic and environmental objectives. Based on energy use characteristics, we subdivided the energy sector into five major sectors: coal, oil, natural gas, thermal power generation, and clean power. The results show that when the carbon emission reduction target is less than 15%, that is, when the equilibrium carbon tax price is less than 54 yuan/ton, the implementation of a carbon tax policy can significantly reduce carbon emission and fossil fuel energy consumption, while only slightly reducing economic growth rate, and can achieve the double dividend of environment and economy. Moreover, because the reduction of coal consumption has the greatest impact on reducing carbon emissions, the ad valorem tax rate on coal after the carbon tax is imposed is the highest because coal has the highest carbon emission coefficient among fossil fuels. In addition, as an emerging clean energy source, hydrogen energy is the ideal energy storage medium for achieving clean power generation in power systems. If hydrogen energy can be vigorously developed, it is expected to greatly accelerate the deep decarbonization of power, industry, transportation, construction, and other fields.

A Study on the Impact of Indian Taxation on Virtual Digital Assets in India

The study explores the implications of India's taxation policies on Virtual Digital Assets (VDAs), including crypto currencies and non-fungible tokens (NFTs). With the introduction of the Finance Act of 2022, which imposed a 30% tax on VDA profits and a 1% Tax Deducted at Source (TDS) on transactions, the digital asset landscape in India has undergone significant shifts. This research examines the economic and behavioural impact of these regulations on individual investors, start-ups, and the broader VDA ecosystem. The findings suggest that the flat tax rate and TDS have led to reduced market liquidity and deterred small-scale traders, highlighting challenges in compliance and record-keeping. However, these measures also formalize the VDA market, potentially attracting institutional investors by providing regulatory clarity. The study identifies gaps in the current policies and offers recommendations to balance regulation with market growth, ensuring a sustainable future for India's VDA sector.

Macro Indicators and Housing Prices in the U.S.

This study examines the influence of macroeconomic indicatorsU.S. GDP, tax rates, population, and interest rateson housing prices across the United States, utilizing data from 1982 to 2018 sourced from the Federal Reserve Economic Data (FRED). Employing a comprehensive analytical framework, including multiple linear regression, time series analysis, and a mixed-effects model, the research identifies GDP and tax rates as significant factors affecting housing prices. GDP positively correlates with housing prices, whereas higher tax rates have a negative impact. The study highlights the importance of accounting for regional variations through mixed-effects modeling, which captures the diverse impacts of economic indicators across different states. This approach offers nuanced understandings to the real estate market's dynamics, emphasizing the role of economic growth and fiscal policies. The findings aid policymakers in understanding the economic forces shaping housing markets and suggest further research avenues, particularly in incorporating recent global economic events like the COVID-19 pandemic.

An Analysis of Policy Frameworks on Business Formulization and Disaster Management to Mitigate Flood Loss and Damage Among Informal Businesses in Sri Lanka

The 27th Conference of the Parties to the United Nations Framework Convention on Climate Change in Egypt made a historical decision on disaster loss and damage for vulnerable countries. Even though parties agreed to salvage vulnerable nations with generous support, a fundamental question remains as to the extent to which these vulnerable countries can accurately identify the most vulnerable communities/areas. In Sri Lanka, informal businesses are particularly vulnerable to floods, but their informal status has limited the extent to which they could receive flood protection, including disaster-resilient infrastructure developments. The main objective of this paper, therefore, is to identify challenges that informal businesses have experienced in dealing with flood disaster risks. In doing so, we analyzed government policies and laws that are related to business formalization and disaster management. We also conducted interviews with key informants to verify our data. Our analysis found that the Sri Lankan government requires informal business owners to follow complicated rules to register their businesses. For these owners, who are not highly educated, these processes and fear of high tax rates discouraged registering their businesses. The central government tends to prioritize flood mitigation actions for formalized business areas. Informal businesses are not usually covered by flood insurance and compensation. In conclusion, we emphasize the need to establish widely available legal and administrative support for informal businesses to register. Adopting business continuity plans (BCPs) and keeping standardized business records also help businesses minimize flood loss and damage.

Earnings Responses to Even Higher Taxes

Abstract We exploit a recent Swedish tax reform, implying higher marginal tax rates for the top 5% of the earnings distribution, to learn about earnings responses to higher taxes. Using a simple and graphical cross sectional method, we estimate an earnings elasticity of 0.16, evaluated four years after the reform. Our analysis indicates that the response is driven by adjustments in wage rates, and not by changes to hours, job switches, or income shifting. We interpret the magnitude and preciseness of the response using a realistically calibrated simulation model in which people face uncertain marginal tax rates due to earnings dynamics.

Bank-specific and Macroeconomic Determinants of Commercial Banks Profitability in Kenya

This study focuses and examines the impact of bank-specific factors and macroeconomic determinants on the financial performance of commercial banks listed on the Nairobi Securities Exchange (NSE) during the period spanning from 2011 to 2020. The research is anchored on transaction cost economic theory with financial panel data methodology. In the pursuit of study objective, the study employed pooled ordinary least squares (OLS) estimation method combined with fixed effect model to account for individual-specific characteristics that may not be directly observable but are likely to impact the dependent variable. The research findings reveal that bank assets, bank capital and debt ratio have a positive impact on bank profitability while bank concentration has a negative effect. Notably, inflation rate, lending rate and tax rate were insignificant in relation to rate of return on equity among the selected banks in NSE. The study recommends that banks should prioritize efficient capital allocation and diversify their business lines and offerings. Therefore, banks should give thought to the implementation of strategic asset management as a means to optimize their asset allocation, as it can contribute to increased profitability through diversification and efficient asset utilization.

Evaluating the macroeconomic impact of environmental policies in New Zealand: A New Keynesian DSGE model to sustainability

This study enhances the environmental New Keynesian framework by integrating spatial spillover effects through a dynamic stochastic general equilibrium model. The simulation results reveal that while environmental regulations can lead to welfare losses, a carbon tax levy mitigates these losses more effectively than alternative approaches in New Zealand. What is surprising is the pro-cyclical nature of environmental policies. For spillovers, shocks to capital and labor tax rates substantially curtail emissions in adjacent regions. Further simulation substantiates that higher price dispersion necessitates a reduced growth rate of emissions. These conclusions compel New Zealand to explore diverse policy options for effectively decarbonizing the economy.

Effects of royalty payment on petroleum profit tax evasion: evidence from the Nigerian non-renewable energy sector

AbstractThe impact of the tax regime on the non-renewable energy sector has been neglected in the current literature. The sector is reported to be at the heart of most oil and gas producing economies. Considering the immense contributions of this sector, the present study investigated the effects of royalty payments on petroleum profit tax evasion in Nigeria’s non-renewable energy sector. A survey, in the form of a questionnaire, was used to collect data from 312 oil and gas companies; while SPSS and PLS software were used to analyze the data. The results indicate that there is positive and significant relationship between tax rate, detection probability, and penalty, and petroleum profit tax evasion. Additionally, the result shows that there is a significantly negative relationship between royalty payment and petroleum profit tax evasion. The findings have significant policy implications for the non-renewable energy sector across the globe. The findings confirm the fact that higher tax rate, detection probability, and penalty, have a direct impact on petroleum tax evasion. The findings also call on policymakers to reconsider the level of royalty rates to a more reasonable level so as to reduce the extent of petroleum tax evasion among the oil and gas companies.

Exploring the Effects of High National Debt on Household Consumption and Foreign Direct Investments

As nations grapple with the challenges posed by increasing debt burdens, finding out the intricacies between macroeconomic indicators would give insights into how household consumption and foreign investments are affected by the high national debt level, and how they move along with the identified variables such as tax revenues and economic health of the country. The goal of this paper is to focus on the implications of high external debt for macroeconomic variables and find out the variables’ effects in the short term and the long term by using a quantitative approach or method. The researchers intend to find out if the household consumption expenditure is influenced by high national debt, tax revenues, total economic health, and foreign investments, or otherwise, finding out as well if the foreign investments are influenced by high national debt, tax revenues, total economic health, and household consumption expenditure or not. The paper also has its constraints given that related literature is limited in terms of the immediate relationship of the variables that the researchers want to study. With the knowledge that high national debt would have a toll on the country’s economic performance or the gross domestic product (GDP), there is the perception of high debt having an impact on household consumption or consumer spending that can alter the living conditions or reduce incomes of the people, given that the government would need to look for ways in order to pay off high debt by resorting to collecting more taxes. An impending increase in tax rates would eat up a portion of personal income that can in turn affect their ability to consume. High tax rates can also discourage foreign direct investments (FDIs) into the country, as this factor can also contribute to decisions to investments since other countries might offer a more competitive tax package. Aside from this, with the perception that a country can be on the brink of debt overheating due to high national debt, foreign investors would hesitate to come in due to the idea that the economy is struggling, a bad precedent for doing business. High amounts of public debt can restrict the government's options for fiscal policy during recessions, which lessens the government's ability to help the economy recover and push forward. As debts increase, the growing perception that this would be contra beneficial to the living conditions of people despite the everyday grind could affect consumption behavior and future expectations on price and policy directions, further affecting the country’s overall economic health. While fiscal policies are strong indicators of government revenue raising and spending directions and actions, tax collection or revenues are necessarily integral as a key variable influencing a country’s capacity to pay that can also limit potentials of incurring a high national debt level. With good tax collection practices and tax policies, as a key source of revenues to help pay off the country’s debt, other factors such as monetary policy are also important. Monetary policy control is needed because rising interest rates can make it more expensive to borrow to cover basic household needs and other forms of financial needs, such as mortgages and other financial obligations. This could limit disposable income and reduce consumer spending. Moreover, related hazards that impact general consumption behavior include the depreciation of the currency and price rises that lead to inflation, which could exacerbate the living conditions of the people. These might lower families' purchasing power. Therefore, the effects of large public debt on investments and budgets emphasize the necessity of sound fiscal management and policy use to reduce any potential negative effects. The research examines the dynamics of macroeconomic aggregates in the context of the nation's high levels of national debt, tax revenue, household spending, and foreign investments. Among the objectives are trend analyses of significant variables such as GDP, tax revenues, foreign direct investment (FDI), household consumption, and national government debt. Another study objective is to comprehend the relationship between tax income, state debt, household expenditure, and foreign direct investments. Its goal is to determine whether the country's growing debt affects household consumption and investments. The study utilizes the Autoregressive Distributed Lag (ARDL) cointegration technique to examine the links between GDP, tax collections, foreign investments, household consumption, and national debt. In conclusion, the analysis' result regarding the influence of total national debt, overall economic health, and foreign investment on the household's final consumption expenditure (HCFE) is largely evident in both the short run and long run. The ARDL is a flexible model that allows analysis at level and first differences. Different lag lengths may also be used in the model having different variables.

Research on the green development path of prefabricated building industry based on intelligent technology

PurposeIn order to make the construction industry develop in the direction of greening, this paper analyzes whether the application of intelligent technology in prefabricated buildings can achieve carbon emission reduction, starting from the problems of weak technology and insufficient encouragement policies in the prefabricated building industry. It also designs dynamic and adjustable incentives for the smart transformation of prefabricated buildings and makes recommendations to facilitate the transformation of assembly manufacturers into “smart factories”.Design/methodology/approachThis paper takes the intelligent technology for carbon reduction, energy efficiency and policy design in the prefabricated buildings industry as the starting point. Based on in-depth expert interviews and questionnaire survey data, a linear multiple regression model is used to establish an association network of intelligent technology in the production and transportation, construction, operation and maintenance, demolition and scrapping stages. On this basis, an evolutionary game theory is used to construct a smart transformation and carbon reduction utility game model between the government and manufacturers, and relevant suggestions for smart empowerment of green construction development technology combinations and policy settings are proposed.FindingsAn assembly manufacturing plant with smart empowerment is an important way to achieve green and sustainable development in the construction industry. Among them, BIM and IoT have made a greater impact on carbon emission reduction of prefabricated buildings in all stages of the whole life cycle. The government’s proposed energy efficiency incentives and environmental tax amount will effectively increase companies' motivation for smart transformation of prefabricated buildings. However, when the environmental tax amount is low, the government should strengthen the regulation of the industry in order to increase the speed of smart transformation of assembly manufacturers. Therefore, a reasonable setting of the environmental tax rate and energy-saving incentives and flexible adjustment of the regulatory efforts can maximize the functional utility of the government in the process of smart transformation.Research limitations/implicationsThis paper focuses on the impact of intelligent technologies on the overall carbon emissions of the industry and provides an evolutionary analysis of the strategic game between the government and assembly manufacturers, the main players in the smart transformation process of prefabricated buildings. However, smart technologies for different categories of assembly manufacturing plants and strategic options for a wider range of stakeholders have not been examined in depth.Originality/valueDifferent from existing research, this study focuses on exploring the strategic game between the government and assembly manufacturers in the smart transformation of prefabricated buildings. It provides an innovative explanation of the connection between intelligent technology and carbon emissions. The study develops an evolutionary game model for both parties, addressing the research gap on the combined effects of policy incentives and intelligent technology on carbon reduction and efficiency improvement in the prefabricated buildings industry. This research not only offers practical reference for the government in designing incentive mechanisms and establishing regulatory systems but also provides feasible practical guidance for the smart transformation and carbon reduction efforts of assembly manufacturing plants.

Optimizing environmental regulation policies for digital transformation in energy enterprises in China: An evolutionary game theory approach

In response to the global consensus on achieving carbon reduction, China has introduced a series of policies aimed at accelerating the digital transformation of energy enterprises. However, these policies have revealed shortcomings such as deficiency in regulation methods and insufficient integration of regulation with technologies. This study applies evolutionary game theory (EGT) to evaluate the impacts of different environmental regulatory policies on the digital transformation and verifies the effectiveness of the theory in policy optimization. Utilizing modified real-world data, the study quantitatively examines the effects of alterations in various parameter combinations on players' strategic choices. The results indicate that: (1) increasing the regulatory intensity above 0.8, the carbon tax rate and penalties can promote the digital transformation, stimulating the low-carbon development in energy sector; (2) an interesting finding is that tax incentives such as carbon tax refund ratio can exacerbate enterprises’ reliance on government compensation, thereby slowing down their transition process; (3) this study highlights the optimal service provision intensity for technological service providers (TSP) is 0.9, which can expedite system evolution towards the ideal state and foster the construction of a favorable digital regulatory environment. The study provides valuable references for optimizing regulatory policies and promoting digital transformation to realize the decarbonization goal.

Development of an Information System for eTax Return Reporting PPh 21 Employees at PT. FBR Mitra Sejati

This research aims to develop an information system that supports collecting Income Tax (PPh) for employees in a tax consulting company. This research analyzes the suitability of the tax collection procedures applied by the company and the applicable tax provisions. The method used in this research is descriptive analysis based on data obtained through interviews, observations, and literature review. The results show that the principle of income tax collection in tax consulting companies is in line with the general tax withholding method, with estimated net income as the basis for calculation. The tax rate variations applied include the provisions in Article 17 of the Income Tax Law and related government regulations. The information system developed aims to improve efficiency and accuracy in the reporting of Income Tax Return 21 and support better tax compliance.

According to British Documents, the Economic-Financial Situation in Greece during the Turkish War of Independence and the Efforts of the Governments to Finance the War

Starting on 15 May 1919 with the Greek invasion of Smyrna, the occupation movement in Western Anatolia put the Greek finances in difficulty with an increasing sum from year to year. The Greek governments were able to finance the war with the financial aid provided by the Allies to Greece before the invasion. However, in November 1920, Venizelos lost the elections and resigned as prime minister, and in December of the same year, the exiled King Constantine, who had great problems with the Allies, was restored to the throne, which deeply affected the Allied relations with Greece. After this date, the country was unable to receive foreign aid, and in order to finance the war, it introduced many measures, especially tax rates, which were burdensome to the people. Naturally, this situation led to a weakening of the purchasing power of the people who were oppressed under inflationary policies. Despite the large deficit in the balance of income and expenditure during the war years, the country's international trade continued at an increasing rate, albeit with some troubled periods.

Wealth Taxation and Household Saving: Evidence from Assessment Discontinuities in Norway

Abstract Neither theory nor existing empirical evidence support the notion that wealth taxation reduces saving. Theoretically, the effect is ambiguous due to opposing income and substitution effects, and empirically, the effect may be masked by misreporting responses. Using geographic discontinuities in the Norwegian annual net-wealth tax and third-party-reported data on savings, I find that wealth taxation causes households to save more. Each additional NOK of wealth tax increases annual net financial saving by 3.76, implying that households increase saving enough to offset both current and future wealth taxes. This positive effect on saving is primarily financed by increases in labor earnings. These responses are the combination of small negative effects of increasing the marginal tax rates and larger positive effects of increasing average rates. My findings imply that income effects may dominate substitution effects in household responses to rate-of-return shocks, which has implications for both optimal taxation and macroeconomic modeling.

Reputational Costs as a Tax Avoidance Deterrent in Small to Medium Enterprises

Reputational concerns are considered a disincentive to tax avoidance. Prior literature examining tax avoidance in the context of large and listed firms attributes this relationship to the scrutiny to which large firms are subject. This begs the question if reputational concerns are a relevant tax avoidance deterrent in the setting of small to medium sized enterprises (SMEs) because SMEs have fewer stakeholders, lower disclosure requirements, and are subject to less media attention. Using survey data from Belgian SMEs, we find that SMEs with reputational concerns report an effective tax rate that is 8.57 percentage points higher than that of SMEs with low reputational concerns. We further examine which firm characteristics moderate the deterrent effect of reputational concerns on tax avoidance. We find that potential reputation damage is more important to the tax avoidance decision of firms with less financial freedom and firms with a higher need to maintain creditor relations. Finally, we document that reputational concerns act as a corporate tax avoidance deterrent against aggressive positions.

ANALISIS PPN DAN PPH BADAN PADA PERUSAHAAN KONSTRUKSI PT. ACG

This research was conducted with the aim of knowing the imposition of income tax rates and corrections contained in the Tax Return period of Value Added Tax on companies. This research was conducted with an interview process to get data on the company's financial statements during 2020 and other information related to what is needed from the company. The results of this study show that the company has applied the final income tax rate in accordance with the applicable provisions and the company also experiences more payment every month so that it can make restitution or compensation.

Analysis Of Factors That Influence Individual Taxpayer Compliance In Jombang Regency

The purpose of this study is to analyze the various factors that influence individual taxpayer compliance individual taxpayers in Jombang Regency. Understanding of tax regulations, WPOP awareness, suitability of tax rates, use of tax applications, and service quality are some of the factors that this study examined their influence on individual taxpayers compliance in Jombang Regency, which is the subject of this study. All individual taxpayers registered with the Jombang Primary Tax Service Office are the population in this study. The sampling strategy used is a simple random sampling of each taxpayer with a taxpayer identification number (Nomor Pokok Wajib Pajak - NPWP). The test was conducted on 100 respondents obtained from calculating the Slovin formula in determining the research sample. This study uses Partial Least Squares (PLS) as a statistical testing tool. Based on the results of the study, understanding of tax regulations does not influence individual taxpayers compliance; individual taxpayer's awareness influences individual taxpayer's compliance; suitability of tax rates influences individual taxpayer compliance; use of tax applications does not influence individual taxpayers compliance; and service quality influences individual taxpayers compliance.

Do CEO Connections to the Chinese Politburo Pay Off and How?

ABSTRACTResearch Question/IssueThis study investigates the effect of connections to the Politburo, the top 25 members of the Chinese Communist Party (CCP), on CEO compensation, pay‐for‐performance sensitivity, and turnover decisions using a comprehensive dataset of 3764 Chinese listed firms from 2007 to 2019.Research Findings/InsightsOur findings reveal that CEOs of privately owned listed firms who have connections to the Politburo via shared educational backgrounds receive significantly higher compensation (up to 20% more). However, such connections do not significantly affect CEO compensation in state‐owned enterprises (SOEs). CEOs who have connections to the Politburo also exhibit lower turnover rates, and their compensation is less sensitive to performance outcomes. Our measure of connections excludes reverse causality, as we leverage an exogenous shock—the promotion to the Politburo of an individual with whom the CEO is already connected—to investigate the gain associated with a political connection in the absence of CEO turnover in private firms. This event allows us to observe that CEO pay increases significantly in such cases. We also find that elite connections serve as a mechanism for resource allocation, as politically connected CEOs in private firms benefit from higher subsidies and lower tax rates, and politically connected CEOs in SOEs benefit by being appointed to larger SOEs. Additionally, we find that the positive relationship between CEO pay and elite connections is even stronger when the connection is stronger but is negative when the CEO is a CCP member.Theoretical/Academic ImplicationsThis study enriches the literature on political connections by introducing a novel proxy for elite connections based on past educational ties to members of the political elite. It disentangles the influence of personal educational connections to the political elite from that of a more generic political membership of the CCP, offering a clearer understanding of their distinct impacts.Practitioner/Policy ImplicationsOur study underscores the necessity of differentiating between private and SOEs in China due to their distinct characteristics and goals. Furthermore, it highlights the critical role of elite political connections in emerging economies such as China in resource allocation, labor market dynamics, and corporate governance.

The Trump Tax Penalty and Its Impact on the Economy

The Tax Cuts and Jobs Act (TCJA) was signed into law by former President Donald J. Trump in 2017.The law took effect on January 1, 2018.The law permanently cut the corporate tax rate to 21% and temporarily lowered individual tax rates. Evidence in this paper will demonstrate how an older married couple on Social Security and a modest pension actually incurred higher federal income taxes during the years 2018- 2021 as a result of TCJA. Paying higher federal income taxes as a result of TCJA is the Trump Tax Penalty.

Reduction of the tax burden as a mechanism for stimulating business development in rural areas

The article is devoted to the study of both theoretical aspects of tax stimulation of the development of entrepreneurship in rural areas, as well as the preferential norms for taxation of enterprises that carry out their economic activities in rural areas, provided for in the current legislation of Ukraine, as one of the effective ways of stimulating their development. The relevance of this issue, especially in the conditions of the full-scale armed aggression of the Russian Federation against Ukraine, is confirmed both in scientific circles and by the survey of business representatives, including micro, small and medium-sized enterprises, conducted after the start of the full-scale invasion. The norms of the current legislation of Ukraine on such main directions of tax stimulation of the development of enterprises in rural areas, which were characteristic of the domestic legislation in different periods of its development, were separately studied, such as: write-off and restructuring of tax debt; reduction of the taxation rate by separate taxes; exemption from payment of certain types of taxes and fees (mandatory payments), introduction of special taxation regimes. On the basis of the conducted research, the advantages and disadvantages of each of these mechanisms of tax incentives were analyzed. It was revealed that, as of today, one of the main preferential tax regimes inherent in enterprises carrying out their economic activities in rural areas is a simplified system of taxation, accounting and reporting. Taking this into account, and in the context of government initiatives to impose an additional fiscal burden in the form of a military levy, in particular, on taxpayers of the third group of single taxes, a proposal is made to balance such a burden at least for a part of taxpayers who carry out their activities in the least favorable rural areas, including the territories affected by the consequences of the armed aggression of the Russian Federation against Ukraine, by reducing the taxation rate with a single tax to 2 percent for the period of martial law and for several years after its termination.