Interaction Of Tax Research Articles

OPTIMIZATION OF MANAGEMENT DECISIONS IN TAX RELATIONS: NEW TECHNOLOGIES AND STANDARDS IN ACCOUNTING PROCESSES

The article addresses the critical role of accounting information in the context of tax relations, particularly in the dynamic business environment influenced by globalization. It emphasizes the necessity for structured data organization and information flow to enhance managerial decision-making processes. A significant focus is placed on the quality of accounting data, which is foundational for effective tax reporting and compliance. The study reviews existing literature, highlighting the contributions of Ukrainian researchers who stress the importance of relevant and high-quality accounting information for decision-making. The paper aims to explore the evolving approaches to accounting data formation, driven by globalization and the challenges it presents in tax interactions. It discusses the implications of adopting International Financial Reporting Standards (IFRS), which have been developed to ensure transparency, comparability, and high-quality financial reporting across borders. The article notes that while IFRS adoption is mandatory for many entities in Europe, discrepancies in implementation exist among member states, leading to varied disclosure requirements. Furthermore, the introduction of the Standard Audit File for Tax (SAF-T) is examined as a modern solution for enhancing data exchange between businesses and tax authorities. This XML format enables tax officials to access comprehensive accounting information, facilitating tax audits and compliance checks. The integration of SAF-T with IFRS reporting is posited to improve data quality and operational efficiency while addressing the increasing demand for reliable accounting information. In conclusion, the article argues that the implementation of IFRS and SAF-T can significantly enhance financial transparency and comparability, thereby reducing risks and costs associated with investment evaluations in the global market. However, it also acknowledges potential challenges in managing accounting practices and the need for advanced measures to accurately reflect a company's financial status and performance. This comprehensive analysis underscores the importance of high-quality accounting data in navigating the complexities of modern tax relations

Tax competition among local governments: Evidence from the spillovers of location-based tax incentives in China

This paper exploits the tax incentives in China's Great Western Development (GWD) Program to identify tax competition among local governments. The reform reduces the statutory corporate income tax rate in GWD regions. Using this exogenous tax reduction as a quasi-natural experiment and adopting a difference-in-differences approach, we find that the reform in GWD regions leads to a 1.6328 percentage point decline in the effective corporate income tax rate and a 0.658 percentage point decline in the macro tax burden in non-GWD counties adjacent to the policy boundary. The results suggest that there are strategic interactions as well as a race to the bottom among counties in their tax setting. The results are stable across a series of robustness tests such as excluding other mechanisms of tax rate interaction and excluding the impact of other incentive policies in the GWD Program. Combined with the tax reduction effect in border GWD counties, we find that the tax interaction coefficient for the effective corporate income tax rate and macro tax burden between GWD and non-GWD counties along the border are 0.8718 and 0.3553, respectively. This reflects the intense tax competition among local governments in China. In addition, we demonstrate that tax competition mainly exists between geographically adjacent counties, as no such spillover effects are observed in non-GWD counties far from the policy boundary.

Development of an interactive multi-region enviro-economic equilibrium (IMR3E) model for managing inner- and inter-region carbon-emission mitigation

Under the multiple pressures of climate change, carbon mitigation and economic development, systematically studying the compound effects of economic and environmental policies on the system is desired. An interactive multi-region enviro-economic equilibrium (IMR3E) model is developed to i) explore various carbon-mitigation effects (and their interactions) under multiple policy alternatives (in terms of carbon, income and production taxes) and their combinations. ii) characterize interactions among sectoral activities of multiple provinces, as well as their inner- and inter-region social-economic and environmental (SEE) effects. It is discovered that about 20 % of the carbon emission of the Yangtze River Economic Belt is to meet the final demands in other provinces (mainly in Guangdong and Beijing) outside the YREB. The power generation sector and the non-metallic mineral products industry (including the cement industry) are the main sources of external carbon emissions. Moreover, the composite effects of the implementation of different enviro-economic policies in YREB will be amplified along with the supply chain, and are reflected in the impact on carbon emissions of different provinces. The adjustment of YREB's production tax and carbon tax will have a certain impact on the indirect emission intensity of other provinces, while the income tax will not. For system symbiosis (i.e., an ecological indicator that reflects the fitness of the entire system), adjusting production tax is the most important factor, and a lower production tax level is the most beneficial. Regarding the consumption-based carbon emission intensity of other provinces, carbon tax policy has the greatest impact, with a contribution rate of over 95 %. Moreover, the interaction of carbon tax and production tax should be fully valued when adjusting the industrial structure.

Financial Regulation of the Import of Cars in the Russian Federation

The article discusses the financial and customs method of state financial regulation in the Russian Federation in terms of imports of cars. The study examined the dynamics of customs duty rates for customs operations, VAT for cars, excise tax rates, statistics on imports of cars for the period 2017–2022. in RF. Within the framework of the analyzed period, the main trends in the customs regulation of imports of passenger cars are characterized, the problems of financial and customs regulation associated with the aggravation of the geopolitical and economic situation in the country are studied. General logical methods (analysis of publications, comparison, generalization) and empirical methods (description, measurement, analysis of statistical data) were used as research methods. The authors provided recommendations to improve the state financial regulation of the import of cars in the current conditions, including improving the mechanism for controlling the movement of goods, increasing the rates of recycling fees, introducing new technical requirements for cars, creating a common electronic and digital platform for the interaction of customs, tax and other state bodies. We found that it is necessary to use an integrated approach to financial and customs regulation.

ПРАВОВОЕ РЕГУЛИРОВАНИЕ ЦИФРОВИЗАЦИИ НАЛОГОВОГО КОНТРОЛЯ В СИСТЕМЕ ОБЕСПЕЧЕНИЯ НАЛОГОВОЙ БЕЗОПАСНОСТИ

Tax control is an important support tool in the system of ensuring the financial security of the state, in particular, in the field of tax administration. The analysis of modern research and publications on the topic of topical issues of tax control, as a factor in the effectiveness of tax administration in the system of ensuring tax security, is in the constant attention of leading domestic and foreign scientists. Moreover, the modern tasks set for tax control are much larger than fixing the facts of non-compliance with tax laws, and include building such a tax administration model that minimizes the ability of the payer to violate the norms of the Tax Code of Russia. Digitization of tax control inevitably involves the introduction of information technologies into the activities of tax authorities, changes in the procedure for tax activities and interaction between participants in tax legal relations, which, of course, entails the improvement of legal regulation in the tax sphere.

ПРАВОВІ АСПЕКТИ ВИКОРИСТАННЯ ПОДАТКОВОЇ НАКЛАДНОЇ ДЛЯ ПІДТВЕРДЖЕННЯ ФАКТУ ПОСТАЧАННЯ ТОВАРУ

The article examines the norms of the Tax Code of Ukraine, the Law of Ukraine “On Accounting and Financial Reporting in Ukraine”, which regulate the procedure for accounting and tax accounting. The judicial practice regarding the interaction of accounting and tax documents has been analyzed. It is noted that the defect in the primary documents and the buyer’s failure to acknowledge the fact of the supply of the disputed goods does not deprive the supplier of the opportunity to prove the supply of the goods with other evidence that will convincingly testify to the actual circumstances of the supply of the goods. It is noted that there is a close relationship between tax accounting and accounting, since both tax accounting and accounting have one object — economic activity and reflect the same economic transactions, as well as accounting and tax accounting are based on primary documents It was concluded that judicial practice provides for the possibility of using a tax invoice as proof of the fact of the delivery of goods under the contract, but on the condition that there is other evidence. It is emphasized that when evaluating tax invoices in combination with other evidence in the case, the courts must take into account the provisions of the Tax Code of Ukraine and the actual actions of the parties to the contract regarding the reflection of the fact of the delivery of the disputed goods in the tax accounting and accounting records. It was determined that tax invoices received from the Unified Register of Tax Invoices cause legal consequences, and the basis for the taxpayer’s right to a tax credit from value added tax is the fact of actual transactions for the purchase of tangible goods. It is noted that establishing the rule regarding mandatory confirmation of tax credit amounts taken into account by the VAT (value added tax) payer when determining tax liabilities, the legislator assumes that these documents are authentic, that is, the transactions they confirm really took place. It has been proven that registered tax invoices in combination with other evidence confirming the real movement of goods can confirm the fact of the supply of goods under the contract, however, this is not clearly provided for by the legislation of Ukraine, but requires a combined analysis of various legal norms and judicial practice. It is proposed in the Tax Code of Ukraine to determine that the presence of registered tax invoices in combination with other evidence confirming the real movement of the goods is the basis for confirming the fact of the supply of the goods in case of a disputed situation.

Responsive tax administration model and tax compliance

The subject.The author studies models of tax administration.The purpose of the articleis to confirm or refute hypothesis that successful tax administration strategy consists a balanced combination of tax enforcement measures and positive incentives.The methodologyof the study includes content analysis of the scientific papers prepared by European and American lawyers and economists.The main results, scope of application. Tax compliance is an essential component of a wellfunctioning tax system. The forms and methods by which states ensure tax compliance, and taxpayers try to avoid paying taxes, change significantly over time, due to the modernization of tax policy, changes in the alignment and transformation of economic forces, institutions, norms and technologies, Historically, tax relations have always been strictly vertical and hierarchical, relying on administrative-command methods of tax administration, and also characterized by retrospective tax audits and the threat of imposing harsh sanctions to ensure tax compliance. The one-sided nature and lack of flexibility of such a model, limited by the triad of regulatory instruments “obligation – control – responsibility”, was initially subjected to comprehensive criticism in the scientific community.Revolutionary transformations in public administration practice have an impact on all aspects of tax interactions, including tax compliance and tax administration. The global trend lies in the understanding that tax administration, in essence, should be expressed not in the confrontation between taxpayers and tax authorities, but in their dialogue, interaction and cooperation.The flexible tax administration model is based on new approaches to public administration based on a shift in emphasis from coercion to persuasion, from rigidity to flexibility, from “reactivity” to “proactivity”, from “influence” to “interaction” between managers and those controlled. Today, fiscal authorities are encouraged to adhere to a «cooperative approach» in dealing with taxpayers, based on principles such as dialogue, mutual understanding, impartiality, reciprocity, transparency, compromise and flexible response. At the same time, law-abiding behavior should be encouraged in every possible way, and unlawful behavior should be subject to increased discouragement.The doctrine of flexible tax administration advocates the development of trust in the relationship between taxpayers and tax authorities, offering the latter a wide range of tools to ensure tax compliance, and not limited to control and sanctions. The main mission of the state is to encourage taxpayers to partner with fiscal authorities and to voluntary compliance.For any state, the most desirable situation is the voluntary fulfillment of tax obligations by all participants in tax interactions, which makes it possible to minimize the size of the tax gap. Both persuasion and coercion as methods of tax administration have their pros and cons. Therefore, the key to a successful tax administration strategy is not abandoning one method in favor of another, but combining them in a balanced manner so that both methods cumulatively complement each other.Conclusions.In order to effectively increase the level of tax compliance, it is necessary to use a comprehensive tax-legal, organizational and informational toolkit, including both tax enforcement measures demonstrating the tax administration's determination to ensure tax compliance on the part of tax violators, and measures of positive incentives and rewards oriented for service support of law-abiding and conscientious taxpayers.

ОСОБЕННОСТИ И ПРОБЛЕМЫ ФОРМИРОВАНИЯ ЭФФЕКТИВНОЙ СИСТЕМЫ ВЗАИМОДЕЙСТВИЯ БУХГАЛТЕРСКОГО И НАЛОГОВОГО УЧЕТА РЕСПУБЛИКИ ИРАК

The paper is devoted to the analysis of modern features and the main problems of the formation of the system of interaction of tax and accounting in the Republic of Iraq. The author considers two points of view on accounting and tax accounting: as a combined interconnected system and as separate accounting branches. The use of analysis and synthesis, description and comparison helped the author to identify the main problematic points and directions for improving the system of interaction between accounting and tax accounting.

Property tax interaction among overlapping local jurisdictions: quasi-experimental evidence from school bond referenda

Property tax interaction among overlapping local jurisdictions: quasi-experimental evidence from school bond referenda

Filling in the gaps in bookkeeping and tax accounting: A comparative analysis of international and Russian practices

Subject. This article explores the origination of the differences between bookkeeping and tax accounting, and their impact on decision-making. Objectives. The article aims to examine the reasons for the discrepancies between bookkeeping and tax accounting, reveal some aspects of accounting of differences from the position of their registration in a uniform accounting system or two parallel systems, if available, and determine the impact of such gaps on investment and management decisions. Methods. For the study, we used analysis and synthesis, observation, comparison, and the dialectical and data collection methods. Results. The article reveals the key features of the interaction between bookkeeping and tax accounting in Russia and foreign countries. It justifies that in today's economic realities, addressing shortcomings between these information systems is not a necessity, and shows the possible impact of differences on investment decisions. The article also graphically presents the application of cost-plus and balance-based methods of accounting for deferred taxes depending on the way information systems are organized, as well as their comparative characteristics. Conclusions and Relevance. The discrepancies between the two accounting systems provide an opportunity to assess the impact of tax planning on drawing a veil over the accounting profit. Studying the cost and balance methods, as well as the dialectic of the interaction of tax planning with the accounting information system, remain relevant. The results of the study can be useful to accounting and tax specialists, and other stakeholders who are studying the interactions of these information systems.

ЦИФРОВАЯ ТРАНСФОРМАЦИЯ КАК СПОСОБ ОСУЩЕСТВЛЕНИЯ НАЛОГОВОГО АДМИНИСТРИРОВАНИЯ ВНЕ ВЕДОМСТВЕННЫХ ГРАНИЦ

The introduction of digital technologies in public administration can significantly increase the efficiency of interdepartmental interaction, which in turn contributes not only to improving the quality of the provision of state and municipal services, but also to the performance of state and municipal functions, including control function. The article reflects the main directions of digital transformation of interdepartmental inter-action of tax and other interested state bodies in order to increase the efficiency of tax administration. The authors conducted a study of the directions for improving interdepartmental interaction within the framework of digitalization of public administration, on the basis of which a methodological approach to the digital trans-formation of interdepartmental interaction was formulated. Among the main results of the study, it should be mentioned the rationale for creating an adaptive digital information platform based on tax authorities in order to improve the efficiency of tax administration, including tax control.

The Effects of a Selective Tax on Contract Design and Tax Timing

Taxation affects income via both a compensation contract response and a worker response. I show that executive contracts adjust to a tax on severances, and executives shift their taxable income timing in response to the interaction of tax and contract. In particular, “golden parachute” severances tend to bunch at a threshold (tied to taxable income) where the tax rate discontinuously increases, and CEOs exercise stock options in bulk to raise their taxable income and boost their threshold. Identification comes from a bunching analysis exploiting a discontinuous change in exercise incentives over time and variation across CEOs in contract incentives and deal timing. The paper demonstrates the role of contract structure in tax avoidance and additionally shows how contract structure affects worker behavior.

To Realize, or Not to Realize? Capital Gains Tax and Portfolio Choice

The central question addressed in this note is whether it is better to sell (and re-purchase) appreciated assets now and pay today's long-term capital gains tax rate, or wait to realize gains in the future and pay a likely higher capital gains tax rate. The authors argue that a framework based on maximizing expected risk-adjusted wealth should be the preferred method for answering some of the important questions arising from the interaction of taxes and investing. Investment theory holds that in a world of efficient markets, random walks and no taxes, horizon shouldn't materially affect many types of investment decisions. However, as soon as tax enters the picture, horizon in many situations becomes the single most important input an investor needs to think about. For investors with long horizons and moderate-size unrealized capital gains, it will usually make sense to defer realization even if the investor expects the tax rate to jump by 20 percentage points. Surprisingly, at intermediate time horizons, the optimal decision can be to realize some, but not all, of the unrealized gains. Investment horizon isn't the only critical input, and the interaction of all the relevant variables puts the development of a generic rule-of-thumb out of reach.

The Fissured Worker: Personal Service Companies and Employment Rights

Abstract A personal service company (PSC) is a form of intermediary with separate legal personality used as a vehicle to provide the labour of the individual who controls the PSC. The rapid growth of PSCs in recent years, and their potential to disguise employment status for tax purposes, have been the subject of much policy and legislation. But their detrimental effect on the employment rights, both individual and collective, has almost been ignored. Evidence shows that PSCs continue to increase at a faster rate than employment, are colonising sectors of the labour market characterised by dependent labour and are often imposed to avoid the duties owed to workers or employees. In this article, I analyse how the existing law might provide a means of protecting the labour rights of individuals who are engaged via PSCs, examining the statutory provisions specific to some legal rights and more general doctrines based on shams, labels and piercing the corporate veil. Although the law provides some protection in some circumstances, PSCs retain their allure as a means of avoiding employment rights. I discuss potential legislative solutions to this problem, which highlights the interaction of tax and employment law and the difficulties caused by relying on the bilateral contract as the keystone of labour rights.

Strengthening Tax Compliance by Balancing Authorities’ Power and Trustworthiness

The traditional economic approach to enforce tax compliance rests on the assumption that taxpayers are reluctant to pay their share, are inclined to maximize their egoistic goals by rationally considering audit probability and fines in case of detected evasion, and comply only if enforced to comply. Behavioral economic and psychological insights draw a more complex picture of determinants of compliance and point to differences between taxpayers and their inclination to be compliant, which calls for differential strategies to ensure compliance rather than a one-fits-all strategy. In the present chapter, actors in the tax arena and interaction dynamics are described. Interaction is shaped by power of the authorities and their trustworthiness, which combined, are the underlying dimensions of the tax climate. As conceptualized in the slippery slope framework and its extension, it is argued that a distinction between coercive and legitimate power, and between reason based trust and implicit trust is necessary to understand the interaction dynamics. Subsequently, emotions elicited by power of authorities and their trustworthiness are described, followed by speculations about the impact of anger, fear or feelings of protection and security on compliance. Finally, strategies to shift from control to cooperation are summarized.

Impacts of horizontal integration on social welfare under the interaction of carbon tax and green subsidies

Both a carbon tax and green subsidies are efficient approaches to limit greenhouse gas emission. However, interactions between these two policies remain a critical gap area. In this paper we consider a channel structure originally consisted of two manufacturers and two retailers each of whom sells only one manufacturer's product exclusively. The products produced by the two manufacturers are substitutable. The government subsidizes consumers who buy low carbon products but imposes a carbon tax on the manufacturer producing high carbon products. We analyze tripartite games among manufacturers, retailers, and the government when horizontal integration between manufacturers or retailers is presented. It is a common belief that horizontal integration reduces competition and thus causes a loss in social welfare. However, we find that, with government intervention, neither type of horizontal integration has an effect on social welfare. Although horizon integration may change the optimal subsidy and carbon tax levels, it has no effect on the equilibrium demands for both products. We also show that the integration of manufacturers does not affect retailers' profits, but the integration of retailers hurts both manufacturers due to the direct head-to-head competition.

Impacts of Neighbors on Local Tax Rates: A Space–Time Dynamic Panel Data Analysis

This article explores the spatiotemporal pattern in the local tax system of Extremadura, a region in the southwest of Spain. Using the most relevant tax in terms of revenues at the local level in Spain, the property tax on urban land, a very general space–time dynamic panel data model with spatial and time period fixed effects, has been estimated to explore different types of strategic tax interactions among local governments. The empirical analysis uses a balanced panel database covering 383 municipalities from Extremadura for the period 2006–2015 to estimate the reaction of tax policy in a given municipality to its own past, to changes in tax policy in other municipalities, and to (direct and indirect) changes in some control variables. The results show that nominal local property tax rates are affected by tax policy inertia from the own municipality and neighboring municipalities and two observed municipal characteristics, whereas effective tax rates depend on tax policy inertia from the own municipality and property tax policies from neighboring municipalities and five observed municipal characteristics. In both cases, local spillover effects are not significant at standard statistical levels.

Expanding the Canada Workers Benefit to Design a Guaranteed Basic Income

We design a hybrid guaranteed basic income and earnings subsidy for working-age Canadians that addresses federalism and work disincentive concerns associated with a conventional basic income by expanding the Canada Workers Benefit. We cost our program and propose a revenue-neutral financing model by consolidating provincial SA programs and eliminating several federal and provincial tax credits. We simulate the distributional effects of our program and financing on household disposable income across deciles and family types and discuss its impact on marginal effective tax rates and interaction with disability programs. Our program substantially reduces poverty rates among two-parent families and working-age singles and couples without children.

Administration of Customs Payments: International Standards for the Interaction of Tax and Customs Authorities

The authors have formulated and consistently proved the hypothesis that well-functioning interaction of tax and customs authorities is required to increase the effciency of the state revenues administration. The mechanism of this interaction should be formed when implementing the standards of the World Customs Organization and the World Trade Organization into the Russian legislation. The research is particularly relevant since Federal Law No. 289 of 03.08.2018 “On Customs Regulation” has entered into force. This law includes article 222 “Interaction and cooperation of customs and tax authorities”. As scientifc and practical results, promising areas for development have been worked out: improving unifed mechanism of customs, tax administration and currency control based on integrated innovative technologies; implementing international standards developed under the auspices of the World Customs Organization; creating prerequisites for the transition to the payment of import customs duties and taxes after the release of goods for law-abiding business; redistributing functions of customs and tax authorities. The authors propose to leave the control of import duties payments for the customs authorities, and to delegate the control of VAT and excise taxes on imported goods payments to the tax authorities. The article includes the results of a comparative legal analysis of the acts of the World Customs Organization, the Financial Action Task Force on Money Laundering (FATF), the Organization for Economic Cooperation and Development (OECD) and the Agreement on Cooperation of the Federal Customs Service and the Federal Tax Service of Russia. It justifes the conclusion that the studied cooperation is the most important tool for the customs payments administration. This is confrmed by the statistics on additional and pre-leased revenues to the state budget based on the results of joint and coordinated verifcation activities. The result of the study is the formulation of promising areas for improving the interaction of customs and tax authorities in the Eurasian Economic union (EAEu) and Russia.

The Effect of Tax Amnesties Programs on Tax Collection and Economic Performance: A Global Macro Economic Analysis

Taxes are a major source of government income. Still a major part of economy exists undocumented. Tax amnesty programs are considered a short term tool to overcome tax compliance for long run benefits as well as short term recovery of revenue. This study is examined the effect of tax amnesties programs on tax revenue percentage to GDP and on macro-economic performance with the interaction of tax to GDP. Panel data of 28 years from 1990 to 2017 were collected from 24 countries and run a different test to support our results. These countries data were taken on an annual basis, where single or multiple tax amnesties launched in different years. GDP per capita, FDI per GDP, and the unemployment rate were taken as Macroeconomic variables, and the influence of tax revenue percentage to GDP in presence and absence of tax amnesty on these macroeconomic variables were tested. Results showed that the tax amnesty scheme affect GDP per capita, and FDI but not through an increase in taxes but some other reason. Successful Tax amnesty may benefit reduce the unemployment rate and improve tax to GDP in long-run with increased tax compliance is still workable. We suggest that tax authorities undertake tax reforms from successful experiences of tax amnesties in different countries for economic prosperity and better results.