State Tax Research Articles

Imām al-Māwardī’s View on the Concept of Taxation (Kharaj) in al-Aḥkām Sultḥāniyyah

Throughout the course of history, spanning centuries, taxation (kharāj) as sources of income of the state is significantly influential in the development of Islamic civilization. Within Islamic civilization, various principles governing the fundamental aspects of the state system, specifically in finance (fiscal and monetary) are formulated. The policy regulating state finance, with a particular focus on taxation, serves as evidence of the foundational principles of Islamic governance aimed at achieving justice and welfare for the people. The state taxation system arose due to the expansion of Islamic territories and the acquisition of spoils of war obtained by Muslims, whether through peace treaties (fay’) or warfare (ghanīmah). Therefore, this research aimed to analyze the concept of taxation in Islam, with a particular focus on al-Aḥkām as-Sultḥāniyyah by Imām al-Māwardī. The conclusion drawn was that the theory of taxation had several advantages; firstly, the thoughts of Imām al-Māwardī regarding taxation were forward-looking, specifically in terms of the flexibility in determining the tax object by adapting it to the conditions of the tax object and subject. Secondly, the imām's conceptualization of taxation remained highly contextual, making it relevant for contemporary application.

A STUDY ON HOW MICRO, SMALL AND MEDIUM ENTERPRISES IS AFFECTED BY GOODS AND SERVICES TAX.

The goal of the Goods and Services Tax (GST), which went into effect in India on July 1, 2017, was to simplify the tax structure by combining several indirect taxes into one cohesive tax system. The effect of GST on Micro, Small, and Medium-Sized Enterprises (MSMEs) is evaluated in this study. By relieving MSMEs of the hassle of managing several federal and state taxes, the GST system improved their operational efficiency and made tax compliance simpler. Administrative difficulties were decreased via the GSTN interface, which made tax registration and return filing easier. A number of benefits of GST for MSMEs are highlighted by the report, such as the removal of the tax cascade effect, an increase in the threshold exemption for tax registration, better supply chain efficiency, and increased competitiveness. In addition, there have been notable advantages from the formalization of enterprises and the use of technology for tax compliance. But the report also lists difficulties like higher costs associated with GST compliance, more burdensome compliance requirements, problems with cash flow, and difficulties with interstate transactions. This research offers valuable insights into the ways in which MSMEs perceive the impact of GST on their operations, finances, and growth prospects. It employs both qualitative and quantitative methodologies, such as surveys and literature studies. The results imply that, despite the benefits that the Goods and Services Tax (GST) has brought about, MSMEs still face a number of obstacles that require government assistance in the form of streamlined compliance processes and educational materials. All things considered, MSMEs have experienced a mixed response to the implementation of GST, with both noteworthy advantages and difficulties. Maximizing the benefits of this tax reform will need ongoing efforts to improve small business understanding and ease GST compliance.

Plus Ça Change: The Fate of the Commission’s Open Investigations

Ten years on from the Commission’s opening investigation into the tax rulings provided to Apple by Ireland, the relationship between State aid law and tax rulings has finally reached a level of equilibrium following the decisions of the ECJ in Amazon, Engie and FIAT. Looking at next steps, the Commission will be considering how these decisions impact its open investigations into rulings granted to Huhtamäki, IKEA and Nike. This article suggests that the Commission, if it wishes to continue its cases against Luxembourg and the Netherlands, should shift its approach away from looking at whether or not there has been a deviation from the arm’s length principle to whether there has been administrative impropriety, baseline abuse or selectivity (using the traditional approach).

Tax policy and activation of internal factors of economic growth: EU experience for Ukraine

The state policy of Ukraine aims to promote sustainable economic growth and improve its quality through economic activity, particularly through the optimization of the tax system, which is particularly relevant both during the period of martial law in Ukraine and the post-war recovery. The purpose of the study is to assess the formation and implementation of the state tax policy to activate the internal factors of economic growth in Ukraine under martial law. The study of tax policy in Ukraine and EU countries has shown that the EU countries are characterized by a consistent and transparent tax policy that stimulates investment, innovation, and entrepreneurship to activate internal factors of economic growth. The paper uses fiscal analysis based on the Cobb-Douglas production-institutional function; its main concept is the mutual location of the Laffer points of the first and second types and the actual level of the tax burden. The results show a noticeable adjustment of the real fiscal climate in Ukraine in line with changes in threshold fiscal standards. Considering martial law in Ukraine and the need for the state’s ability to post-war recovery, the study suggests changing the rates of specific taxes, after which it is necessary to make a transition from private fiscal instruments with inherent rate values to the aggregate fiscal burden.

АУДИТ ОПОДАТКУВАННЯ В СИСТЕМІ НЕЗАЛЕЖНОГО ЕКОНОМІЧНОГО КОНТРОЛЮ В УМОВАХ ВОЄННОГО СТАНУ: СУТЬ, ПРОБЛЕМИ, ПЕРСПЕКТИВИ

Introduction. Taxation audit is an independent check of the company's tax reporting for the purpose of confirming its authenticity and warning about additional payments to the budget in the form of taxes and fines that may be added by state control bodies in the future. Problem Statement. Today, the definitions of “taxation audit” and “tax audit” are not clearly defined in the economic literature, there is no clear model of taxation audit in the conditions of martial law. Purpose. To improve the categorical apparatus “taxation audit”, to analyze the place of taxation audit in the system of independent audit; to develop measures for improving the organization of its conduct. Methods. Theoretical approaches to the “taxation audit” category by various scientists, official data from the public report of the State Tax Service of Ukraine, results of the research work of the Department of Financial Analysis and Taxation of the State University of Trade and Economics were used. The methods used are: generalization, systematization, comparison, critical analysis, grouping, evaluation, coefficient analysis. Results. The results of research into the economic essence of “tax audit” are highlighted. The author's interpretation of the “tax audit” category is designed. An analysis of tax audit methods was carried out, a general model of taxation audit for small business enterprises was developed. Conclusions. The interpretation of “tax audit” proposed by the authors will make it possible to identify new criteria for distinguishing (detection) and classifying tax audits, thereby improving the provision of management decision-making, which will provide a greater probability of knowing the object.

Development of proactive mode of providing tax deductions for personal income tax

The paper studies discussion issues of the simplified procedure for obtaining tax deductions for personal income tax (hereinafter referred to as PIT). The objectives of the study are the following: to review the changes in tax legislation from January 1, 2024 in the field of proactive mode of granting tax deductions for PIT, to justify the increasing role of this interaction between individuals and tax authorities, to identify current problems and to search for ways of solving them. The authors analysed the practice of application of the simplified procedure for obtaining property and investment tax deductions; statistical data of the Federal Tax Service of Russia on the provision of tax deductions in a simplified manner (1-DDK statistical form “On the declaration of personal income”). The analysis of key changes in the provision of deductions entering into force on January 1, 20124 was also conducted. The main problems that individuals may have when receiving deductions or that tax authorities may face in the course of tax control are highlighted, and possible ways to solve them are identified. The authors concluded, firstly, that it is necessary to form prefilled applications not only while receiving tax deductions, but also when paying PIT, for example, when a person sells real estate, cars. Secondly, it is required to enshrine in tax legislation the order of priority of providing tax deductions if a taxpayer has the right for several types of them. The obtained results can be used in developing solutions to taxation of personal income and provision of tax deductions, in legislative drafting on improvement of provisions of the state tax policy.

HUMAN RESOURCES MANAGEMENT EFFICIENCY ISSUES RELATED TO ARMENIA’S TAXATION

The results of effective management of human resources are most clearly manifested in state agencies. In this regard, the state tax service is not considered an exception, where the effectiveness of tax administration and fiscal policy management is largely determined by the available quality of used labor resources. The article presents recommendations for improving the quality of labor resources in tax services, based on the analysis of international experience. Special emphasis is placed on systematic measures to ensure the quality of labor resources, such as motivation, targeted trainings, professional advancement paths.

Issues of Improving the Implementation of Tax Control when Managing Tax Risks and Tax Audits

This scientific article highlights current issues in the field of reforming tax administration in the Republic of Uzbekistan, on further improving the activities of state tax authorities and the formation of a “digital economy” with high efficiency and development of the system, as well as accelerating the implementation of generally recognized international norms and standards in the field of tax control in national legislation clarifies the essence of the issues and explains the procedural rules of these processes. In particular, the determination by the State Tax Committee of the Republic of Uzbekistan of the strategy and tactics of the tax risk management system, collection and processing of information, analysis and assessment of tax risk, development and implementation of measures to manage tax risks is emphasized. The author provides a definition of the concepts, tax risk - that is, it is the possibility of non-fulfillment or incomplete fulfillment by the taxpayer (tax agent) of tax obligations, which can lead to non-payment or incomplete payment of taxes and fees to the budget system. At the same time, the level of tax risk is a state of risk, which is determined depending on the likelihood of the risk occurring and its possible consequences. From the above, the need to automate procedures for compliance with tax legislation and simplify its procedure is analyzed. The importance of introducing simplified mechanisms to extend the deadline for paying taxes or installments was emphasized. Here, every tax official, entrepreneur and taxpayer must thoroughly master the rules of the Tax Code, for which they need regular training. At the end, recommendations were developed for involving prestigious, influential foreign experts with extensive practical experience in this field in this process.

The Economic Policy of Gábor Bethlen and Its Legal Implications

The background for this research and the writing of this article is that the 400<sup>th</sup> anniversary of the death of Gábor Bethlen is approaching, and the Corpus Juris Hungarici and some representatives of the Hungarian scholarly elite (see e.g. Trócsányi) play a significant role in the literature researched. The role of Gábor Bethlen Hungarian and Transylvanian history can be, and probably should not be, disputed, because his domestic, foreign and economic policies served to maintain the "Hungarian" state of the Principality of Transylvania. Its practical implementation can always be subject to so-called "criticism". In this respect, it is worth examining both the theoretical and the practical aspects, as well as the legal and economic-historical aspects, as far as possible, including tax and economic policy and, where appropriate, the various (even sociological) aspects of these, since their outline may be of assistance to the legislators of today. As a result of the research, it can be concluded that the Transylvanian state tax system is particularly striking in this respect; the levying of taxes without regard to the mate-rial strength of the subjects is in stark contrast to the idea that Transylvania in this period can be equated with absolu-tism in the Western sense, nor does it elevate the Principality of Transylvania to the rank of Western absolutism, although it was an indication of the prince's unlimited power that he could "abolish" the Diet. The reason for this was that he did not change the structure of the estates and central govern-ment that had existed since 1541.

SMART STRATEGIES IN THE INDONESIAN PROPERTY MARKET: TAX AVOIDANCE, PROFITS AND SUPPLY

Tax evasion is common in various sectors, including the property industry in Indonesia. This practice can be carried out through manipulation of financial reports, exploiting legal loopholes, or placing investments in areas with lower taxes. This research focuses on the impact of profitability and inventory intensity on tax avoidance in the property and real estate sector. The sample was selected from property and real estate companies listed on the Indonesia Stock Exchange, taking into account the criteria of financial data availability, reporting consistency and adequate industry representation. The research results show that profitability and inventory intensity have a significant influence on tax avoidance in this sector. These findings provide important insights for financial practitioners and regulators in developing more effective and fair tax policies. With a better understanding of the factors that influence tax avoidance, regulators can design more careful policies to prevent practices that harm state tax revenues and create equality in the tax system.

Ensuring the spatial integration of Ukraine based on updated instruments of cooperation of regions and communities

The article aims to delve into the potential of Ukraine's spatial integration, focusing on activating regional and community cooperation tools. the study employed a robust set of scientific methods, including induction and deduction, comparison, systematization and generalization, and the graphic method, underscoring the thoroughness and reliability of the research. The article critically examines the current state and pressing issues surrounding enhancing public-private partnerships and inter-municipal cooperation. This analysis is particularly relevant in the context of Ukraine's need to form an integrated economic space amidst the challenges of war and post-war recovery, highlighting the urgency and importance of the topic. It was established that the main problems that inhibit the development of public-private partnerships in Ukraine are the considerable duration of the procedure for preparing PPP projects, instability of the state's tax and investment policy, limited financial resources of stakeholders, lack of specialists for the development of public-private partnership projects, its full-fledged technical and economic justification, preparation of tender documentation, etc. Considering the above, ways of increasing the effectiveness of public-private partnerships as a tool for forming an integrated and competitive economic space of Ukraine in the conditions of post-war reconstruction are proposed. The main problems that slow down the development of inter-municipal cooperation as a tool for the formation of an integrated economic space are named (lack of a consistent and clear regional policy of stimulating the development of inter-municipal cooperation of territorial communities; low effectiveness of the implementation of existing agreements on inter-municipal cooperation due to a lack of financial resources, the transfer of forces and funds to the wartime economy; limited possibilities of attracting credit instruments by MMC participants; lack of statistical information on the effectiveness and efficiency of the implementation of existing agreements on inter-municipal cooperation). Considering the above, directions for increasing the effectiveness of inter-municipal cooperation as a tool for forming an integrated economic space of Ukraine in the conditions of post-war reconstruction are named. The importance and necessity of simplifying the procedure of inter-municipal cooperation, clarifying roles and responsibilities, and removing legal barriers to inter-municipal cooperation were emphasized. Keywords: spatial integration, community cooperation, public-private partnership, inter-municipal cooperation, post-war reconstruction, regional economy.

Promotion of freelance services in the digital environment

The article analyses the concept of freelance (temporary, project employment) within the framework of new approaches to employment and changes in the perception of remote and hybrid forms of employment by society and business after the COVID-19 pandemic. The following segments of the labour market where freelancing is the most common element are considered: copywriting, law, software development, design of buildings and structures, creation of graphic, audio and video content, consulting, provision of expertise, tutoring. The portrait of a freelancer is studied in detail according to such characteristics as the region of residence, sex, average age, the share of “real” freelancers and the share of part-timers, experience of interaction with freelance platforms, tax status, single and team players, the reasons for choosing freelancing as a form of employment, the most valuable component of freelancing, the disadvantages of freelancing as a form of employment and motivation of freelancers. The main methods of promoting freelance services in the digital environment are identified: a portfolio site, active maintenance of a professional profile in social networks and its advertising, registration on aggregator sites, freelance and human-cloud platforms. The main element of the portfolio site is highlighted – the works performed by a freelancer (texts, photographs, graphics and similar materials) – along with the key factors that a freelancer needs to consider when creating and maintaining a portfolio site and the most common mistakes

The Threat Of Tax Avoidance By Multinational Companies Through Profit Shifting

Tax is a mandatory contribution that taxpayers must submit to the state in accordance with the provisions of the law. However, in reality, tax avoidance by multinational companies through profit shifting has resulted in Indonesia losing tax revenue every year. Based on this, the discussion in this study is the causes of the threat of tax avoidance by multinational companies through profit shifting. This research also discusses intelligence strategies in facing the threat of tax avoidance. The method used is qualitative with data sourced from interviews and literature studies. The analysis used is Creswell analysis processed through the Nvivo application. This research also uses data source triangulation to examine data validity. Based on the research results, the causes of this threat are the intention and ability to jeopardize tax revenue. Intelligence strategies in facing this threat are a combination of intelligence objectives, intelligence methods, and intelligence resources. Intelligence objectives include state revenue, tax compliance, and Data-Based Organizations. Intelligence methods include Business Intelligence (BI), Compliance Risk Management (CRM), and data analysis. Intelligence resources include cooperation and data and information.

Transfer Pricing State Audits on the Upswing

While the Internal Revenue Service has long scrutinized cross-border intercompany transactions, state tax authorities are increasingly focusing on state transfer pricing. This trend poses new challenges for company groups operating in multiple states. In states with separate tax reporting, each entity within an affiliated group is treated as a separate taxpayer for state income tax purposes, which can lead to profit shifting by manipulating transfer prices between affiliated entities in different states. In this regard, state tax authorities are taking a more proactive approach to examine and audit state transfer pricing positions. Recent significant state transfer pricing case law highlights the importance of preparing and maintaining adequate documentation to support intercompany transactions during state audits. Specifically, preparing an adequate transfer pricing study can be crucial for risk management by minimizing potential challenges from state tax authorities.

Beyond the smoke: Historical analysis of the revenue implications of state cigarette tax policies, 1989 to 2019

IntroductionWhile cigarette taxes are a vital tobacco control tool, their impact on cigarette tax revenue has been largely understudied in the extant literature. This study examines how the level of cigarette taxes affects the revenue generated from cigarettes in the United States over a thirty-year period. MethodsWe obtained the Tax Burden Data from the Centers for Disease Control and Prevention (1989–2019). Our dependent variables were gross cigarette tax revenue and per capita gross cigarette tax revenue, and our independent variable was state tax per pack. We used two-way fixed effects to estimate the relationship between state cigarette tax revenue and cigarette taxes, adjusting for state-level sociodemographic characteristics, state-fixed effects, and time trends. ResultsThe study reveals that raising cigarette state tax by 10 % led to a 7.2 % to 7.5 % increase in cigarette tax revenue. We also found state and regional variation in taxes and revenue, with the Northeast region having the highest taxes per pack and tax revenues. In 2019, most states had low or moderate taxes per pack and tax revenues per capita, while a few states had high taxes per pack and tax revenues per capita. ConclusionsOur research demonstrates the positive impact of increased cigarette taxes on state tax revenue over three decades. Not only do higher taxes aid in tobacco control, but they also enhance state revenues that can be reinvested in state initiatives. Some states could potentially optimize their tax rates.

A profile of urban agricultural growers, organizations, their needs, and challenges in the Northeastern United States.

Urban agriculture is increasingly valued as a strategy for improving quality of life in cities, but urban growers face challenges and often lack coordinated support from governments and the agricultural industry. We surveyed urban growers through an online survey, primarily in the Northeastern United States, to develop a profile of growers and associated organizations, assess the current state of urban agriculture, and determine how universities could help meet their needs. A total of 394 respondents completed the survey and most urban growers were white (non-Hispanic) and younger than 45 years old. Women and men were in almost equal proportion. Urban growers were well-educated, but most did not receive a degree in agriculture. Urban agriculture in our study area was dominated by relatively small non-profit organizations and home and community gardens were the most common types of organizations. Urban agricultural organizations want to improve environmental sustainability and socio-cultural conditions through food access and security, regardless of their tax status. Urban growers face diverse barriers and challenges and the most ubiquitous barriers and challenges reported by respondents were related to availability of land and long-term access in urban areas. Many respondents received low revenue or were operating at a net loss even though they reported diverse income streams. Respondents need a wide range of training, including in traditional agricultural topics as well as financial management and business trainings. Universities can play a key role in promoting urban agriculture by offering training and research. Workforce development is a large priority among universities, so urban growers should regularly be consulted, and the results shared with career and workforce development professionals and researchers in urban areas to identify training and research that meets the needs of stakeholders.

Effective Tax Rates and Firm Size under Turnover Tax: Evidence from a Natural Experiment on SMEs

Abstract Taking advantage of Romania’s compulsory and unique presumptive tax system (turnover tax) for the smallest of the small- and medium-sized enterprises (SMEs), which unequivocally allows grouping the companies into two subsamples according to their tax status (the smallest of the SMEs, i.e. micro-companies for tax purposes, subject to alternative turnover tax vs larger SMEs subject to regular profit tax), the papers compute and compare three versions of firm-specific effective tax rates and brings first-time empirical evidence on the effects of turnover taxation on corporate tax burden. The results show not only that in Romania, the turnover tax is now the prevailing tax system, massively displacing the profit tax, but also it is more burdensome in terms of taxes actually paid relative to the firm size. Moreover, turnover taxation means that taxes are due irrespective of the profitability of a company, making the share of companies who paid taxes despite having losses much higher for micro-companies than for larger SMEs, which translates into higher public finance receipts, at the cost of lower tax equity. Since the corporate tax burden triggered by turnover taxation remains under the radar of even the most qualified policy reports, the results offer relevant lessons for other jurisdictions and have valuable policy implications.

THE REVENUE SOURCES OF AIZAWL MUNICIPAL CORPORATION: TAX AND NON-TAX

Municipal corporations generate revenue from various sources to fund their operations and provide services to residents. Municipal revenue sources are broadly divided into - Tax and Non-tax revenue. Tax revenue includes property taxes, which is the collected from property owners, based on the assessed value of their properties. Non-tax sources of municipal revenue typically refer to revenue streams that local governments collect apart from taxes, such as, use fees and charges, licences and permits, fees and penalties, grants and find transfers, investment income, etc. Like other municipalities in India, especially, smaller municipalities, Aizawl Municipal Corporation (AMC) is heavily dependent on fund transfers from higher governments such as, the central and state governments. This is basically due to the limited revenue sources available to the Corporation. The AMC received funds primarily, through state tax devolution from the state government as recommended by State Finance Commission. The revenue resources of Aizawl Municipal Corporation include Own Revenues, consisting of Tax Revenues (of which the property tax is a major source) and Non-Tax Revenues such as funds for local bodies, grants and devolution by the State Government, Grants from the Central Government and Finance Commissions and other receipts. Data shows that the contribution of own source revenue is very small, less than one-third of total revenue expenditure in 8 of the last 12 years. The financial resources of the Aizawl Municipal Corporation play a critical role as engines for the growth of local bodies in the state. KEYWORDS: Revenue sources of municipalities, Tax and non-tax revenue of municipal corporations, AMC

How does the stringency of state tax and expenditure limitations influence opportunistic taxation?

ABSTRACT Elected politicians often adopt fiscal policies to secure (re-)election, sometimes diverging from voter interests by altering revenue streams. Recent research indicates that contextual factors may curb such opportunistic taxation yet the impact of state-level tax and expenditure limitations (TELs) on this behavior remains debatable. We contend that TELs may prevent revenue manipulation linked to electioneering. Analyzing panel data from 45 U.S. states from 1980 to 2013, we observed electoral influences on taxes (sales, excise, and income) and non-tax revenues (charges and fees) where TELs are absent, and a suppression of these influences under stringent TELs. Contrary to previous findings, our results demonstrate TELs’ effectiveness in reducing political manipulation of fiscal measures, suggesting significant implications for understanding the interplay between fiscal institutions and political budget cycle.

State Taxation of the Motorcycle Transport Business and Internally Generated Revenue in Ebonyi State, Nigeria, 2015 to 2021

In classical literatures, the informal sector is regarded as all those economic activities that are neither taxed nor monitored by any form of government. However, with the downturn of economic activities in Nigeria due to the dwindling oil revenue which forms the major revenue generation and export earnings of Nigeria, the informal sector, specifically the motorcycle transport business popularly known in Nigeria as Okada has come under some form of government taxation and monitoring in some states in the country. This was to shore up their revenue base which has dwindled over the years. Extant literatures have not been able to examine the contribution of informal sector, specifically, the motorcycle transport business to internally generated revenue of the sub-units, especially Ebonyi State within the period under study. Thus, we pose the question: has the taxation of the motorcycle transport business operation improved on the internally generated revenue of Ebonyi State between 2015 and 2021? We anchored our analysis on Public Choice Theory of politics and economics. Data for the study were collected through both primary and secondary sources. The study found that despite the intensive taxation of the informal sector in Ebonyi State, specifically, the motorcycle transport business; the internally generated revenue of the state seems to be decreasing rather than increasing, given the number of taxable objects that has been brought under its internally generated revenue sources. The study recommended that the government should do more in the area of its internally generated revenue to ensure efficiency in collectability and remittances.