Tax Measures Research Articles

TAX INSTRUMENTS IN ENSURING STRUCTURAL TRANSFORMATIONS OF THE ECONOMY

The paper substantiates the role of tax regulation as a key instrument of state economic policy aimed at ensuring macroeconomic stability, stimulating economic growth, and supporting socio-economic development. It is determined that through a combination of tax policy, government spending, and public debt management mechanisms, the state influences structural changes in the economy, ensures the modernization of individual sectors, promotes investment attraction, and increases competitiveness. Systemic, complex, and local instruments of tax regulation are considered, which allow achieving economic policy goals, including stimulating the development of innovative technologies, supporting employment, and ensuring social justice. Approaches to the classification of tax instruments according to functional principles are generalized, increasing state regulation's efficiency and ensuring economic development's sustainability. Approaches to the classification of tax instruments aimed at stimulating strategic changes in sectors of the national economy to ensure sustainable development are substantiated. The main groups of tax mechanisms are identified, including additional benefits and discounts, investment incentive instruments, measures to support research and development, tax incentives for export development, regional preferential tax regimes, and mechanisms to support employment and employee training. The features of the application of each group of tax instruments that contribute to the modernization of the economy, the development of innovative sectors, and ensuring regional economic growth are considered. The systematization of tax measures confirms that the most effective regulatory instrument remains tax incentives, which are widely used to support priority industries and stimulate structural transformations of the economy.

The Influence of Green Taxes on Corporate Social Responsibility (CSR) and Sustainable Development of Listed Oil and Gas Firm in Nigeria

This study investigates the influence of green taxes on Corporate Social Responsibility (CSR) and sustainable development among listed oil and gas firms in Nigeria. Utilising a purposive sampling method, primary data were collected through a structured questionnaire administered to 40 respondents, selected as five representatives from each of the eight firms. The research employed descriptive statistics, correlation analysis, and multiple regression techniques to analyse the data. The findings reveal a moderate positive perception of green tax policies, with green taxes significantly influencing CSR practices (β = 0.474, p < 0.001) and sustainable development outcomes (β = 0.450, p = 0.002). The models accounted for 31% and 23% of the variance in CSR and sustainable development, respectively. These results underscore the role of environmental fiscal policies in incentivising responsible corporate behaviour and promoting sustainable development within the oil and gas sector. The study recommends that both government and corporate leaders strengthen the implementation of green tax measures and integrate these policies into strategic planning to achieve enhanced environmental performance and sustainable growth.

CORPORATE TAX RATES IN THE CONTEXT OF TAX HARMONIZATION

Corporate taxes are important for this study since differences in rates can lead to distortions in economic competition and relocation of capital to countries with better tax conditions. The goal of this article is to verify whether countries with lower corporate taxes are catching those with higher rates. To achieve this objective, we conduct an analysis of the development of nominal and effective tax rates in EU member states for the period from 2004 to 2022. Afterward, we tested the relationship of these tax rates for corporate taxation using the Beta convergence model, observing the speed of convergence and examining whether the differences decrease over time. The results of the analysis demonstrate that the significant decline in nominal and effective tax rates during the observed period indicates an effort to enhance tax competitiveness and stimulate economic activity through tax measures.

Trading away tax sovereignty? How trade rules shape taxation of the digital economy in Africa

Abstract The advent of digital and data-driven business models has heightened the risks of tax base erosion and evasion, adversely affecting revenue generation, economic recovery, and advancement of tax justice in African economies. We develop a framework examining how trade rules on services, electronic transmissions, and digital products shape the ability of African countries to tax their digital economies. We consider four types of taxation instruments: (i) corporate income tax; (ii) value-added tax; (iii) customs duties on electronic transmissions; and (iv) digital services tax. To illustrate the practical implications, we apply our framework to Kenya, Rwanda, and South Africa. These three case studies reveal that trade rules in services and electronic transmissions have a direct effect on the legal position of the country to tax its digital economy, whereas digital trade rules, such as those related to data flows, localization, and source code sharing, produce both indirect and administrative effects on tax measures. These rules can alter tax structures, taxation rights, data collection, and the capacity to monitor and implement tax measures.

Decarbonizing Economies: Balancing Growth and Green in South Africa, Mozambique, the United Kingdom and Sweden

This article critically examines climate change taxes, environmental pollution levies and related policies in South Africa, the United Kingdom and Sweden, assessing their design, implementation, economic impacts and efficacy in reducing carbon emissions and promoting green growth, while also analysing Mozambique's potential to adopt such strategies given its current absence of such taxes. Key performance indicators, including emission reductions and tax revenues, are analysed to gauge the effectiveness and limitations of each model. Sweden’s pioneering carbon tax demonstrates the intricate balance between economic growth and environmental targets, providing a well-documented case of both successes and trade-offs. The United Kingdom’s Carbon Price Floor, emissions trading system, Aggregates Levy and Climate Change Levy show a flexible yet complex approach that integrates various economic sectors. South Africa’s carbon tax, implemented within a developing economy context, sheds light on the socio-economic challenges and potential benefits of carbon taxation in emerging markets. In contrast, Mozambique – a low-income, climate-vulnerable country – offers a unique perspective with its existing environmental policies but lack of specific climate change tax measures, highlighting an area for potential climate change mitigation policy innovation.

TAX EVASION RISK REDUCTION STRATEGIES FOR INCREASING TAX SECURITY OF THE STATE

Tax evasion causes serious damage to public finances every year, and effective strategies to combat these risks are essential to ensure stable budget revenues. The aim of the study is to analyse the causes of tax evasion and evaluate the relevant policy measures based on the experience of different countries. The study employs econometric analysis, case study, and correlation analysis. The results show that the level of corporate governance, as well as the degree of transparency, are inversely proportional to tax evasion situations. The study found that international measures such as a common reporting standard are important in minimizing cross-border tax evasion, but this depends on the effectiveness of domestic implementation structures. The work confirms that good governance, transparency and corporate social responsibility play an important role in the fight against tax evasion. The study supports the argument that domestic reforms and international cooperation are needed to improve tax compliance. It is necessary to carry out further research on the cultural and social consequences of tax evasion. It is important to consider digitalization and its impact on compliance with tax legislation. Sector-specific analysis of tax avoidance behaviour can be useful for decision-making by policy-makers. Further research could also consider the effectiveness of newly introduced tax measures and international agreements in a dynamic economic environment.

Editorial: The ‘Decluttering’ of EU Direct Tax Law

p class="MsoNormal"Unleashing the economic power of the EU’s Single Market and boosting Europe’s competitiveness and innovation capacity requires a fresh look at the immense administrative and regulatory burdens that have been created over the past decades. This also has a tax dimension, and – as Wopke Hoekstra, the Commissioner responsible for taxation – has recently put it: ‘Decluttering is of the essence’. Indeed, in a post-Pillar Two tax environment, many existing tax measures may have lost their relevance or even be duplicative. Moreover, perhaps the time has come to consider broad common rules for European companies: While this would not be ‘decluttering’ of EU tax law itself, the creation of common regimes that replace the Member States’ rules would ideally be a ‘one in, twenty-seven out’ approach.o:p/o:p

Impact of Fiscal Policy on Economic Growth in Developing Countries

This study examines the impact of fiscal policy on economic growth in developing countries, emphasizing the role of government expenditures and tax policies in shaping economic outcomes. The findings indicate a strong positive relationship between fiscal policy and economic growth, where government spending and tax measures significantly contribute to enhancing economic performance. Specifically, the study reveals that well-structured fiscal policies can effectively promote growth, with key fiscal tools such as public investment and tax reforms playing a vital role. The results suggest that developing countries can achieve higher economic growth by implementing strategic fiscal measures, which can address structural challenges and encourage sustainable development. The research provides essential insights for policymakers to design more efficient fiscal policies that foster long-term economic stability and growth.

Towards a Clear and Autonomous Definition of Tax Measures in International Investment Agreements

This contribution is concerned with addressing an increasingly topical issue within international economic law and, in particular, the interface of international tax and investment law, which has seen unprecedented developments in recent times and now appears to have reached a point of discontinuity. This contribution focuses, in particular, on reconstructing an autonomous contemporary definition of “tax measures” under international investment agreements in light of the contribution of scholarship and of recent investment arbitration awards, contrasting these trends with developments in the area of tax treaty interpretation.

Effect of e-cigarette taxes on e-cigarette and cigarette retail prices and sales, USA, 2014–2019

ObjectiveTo use a standardised e-cigarette tax measure to examine the impact of e-cigarette taxes on the price and sales of e-cigarettes and cigarettes in the USA.DesignWe used State Line versions...

Implementation of a Laboratory Experiment in a Student Environment to Study the Behavior of Taxpayers in Russia

The purpose of the work is to develop and test a methodology for conducting a tax experiment in the educational process to determine the optimal level of tax burden and study the behavioral motives of individuals. The research materials are the data of a laboratory experiment conducted in 2021 among the students of Russian universities (304 questionnaires). Research methodology: questionnaire survey, decision tree, random forest, cluster analysis, canonical analysis, matching method, tabular method. The hypothesis of the study is that the most effective instrument for stimulating voluntary declaration of income of individuals is tax control, rather than stimulating tax measures aimed at reducing the tax burden and exempting citizens from tax liability measures. The desire to declare is not based on the income level of the taxpayer, but on tax costs. At the same time, the effect of the probability of being audited by tax authorities on the declaration of income is much stronger than the influence of the size of the tax rate. Finally, the general perception of the tax system determines the category of the taxpayer with a probability of 99.34%. The scientific novelty of the study lies in the complex development of a new methodological approach to conducting and processing the results of laboratory experiments based on factor surveys of students and allowing them to assess the optimal tax burden, to identify moral, ethical and financial motives for the tax behavior of individuals. The study differs from previously conducted Russian and foreign analogues in that it makes it possible to assess the impact that the tax payer's educational background has on their taxpaying behavior under different fiscal conditions and reveals in detail not only the technology for conducting such an experiment, but also methods for processing its results.

Sugar-sweetened beverages: taxation evidence from seven European countries and recommendations for implementation in other EU regions.

Higher-than-recommended sugar consumption (< 10% of total energy intake; WHO) leads to negative health impacts and the development of serious diseases. Sugar-sweetened beverages (SSBs) proved to be among the leading sources of free sugar intake, as they contain large amounts of added sugar. Our article aims to propose tax measures that will help change consumer behaviour and reduce SSBs consumption. For a comparison of the forms of taxation, the experience of seven countries (Denmark, France, Hungary, Italy, Poland, Catalonia - Spain, and the UK) were analysed. The evolution of sugar consumption, consumption of sweetened drinks and obesity before and after the introduction and/or abolition of the sugar tax were reviewed. States that implemented a tax on SSBs were able to reduce SSBs consumption in the first year after the tax was introduced when states with a sugar-content-based tax have implemented it more effectively than states with a volume-based tax. Based on this finding, we propose basic design assumptions for the tax that can be used in European countries that have not yet introduced the tax. Progressive taxation divides beverages into 3 bands. The basic assumption is to encourage the desired consumer behaviour, i.e., consumption of SSBs with lower sugar content. The proposed tax design is applied to the conditions of the Czech Republic as a model case study. The results of our study suggest that SSBs taxation could be an effective policy intervention to improve population health by reducing the health impacts of SSBs among children and adolescents, although further studies are needed to prove the causality of the described associations.

Assessing the Effectiveness of the Fiscal Policy Tools in Facilitating Inclusive Economic Growth

Introduction. Fiscal policy aims to promote economic growth and ensure inclusive growth in reaching low-income populations and benefit from economic activity. Therefore, fiscal policy instruments should be appropriately chosen to achieve inclusive growth. Maintaining the financial system's stability determines the critical role of fiscal policy, especially given its impact on economic growth and the reduction of income inequality. Therefore, it is crucial to identify targeted fiscal measures to promote economic development and reduce income inequality simultaneously. Aim and tasks. This study investigates the effects of fiscal policy instruments on inclusive growth in several selected countries, including EU members and EU candidate countries. The analysis covers the period from 1996 to 2022, using a Bayesian VAR model to examine data on direct and indirect taxation and current and capital spending, with GDP per capita (or GDP growth) and the GINI index serving as the impact variables. Results. The results indicate that capital spending positively affects GDP growth while reducing the GINI index, which causes inclusive growth but does not have an immediate impact. Current spending is a fiscal policy instrument that does not positively affect inclusive growth, as it does not promote economic growth but only increases income equality. Direct taxes increase GDP but do not always reduce the GINI index. As for indirect taxes, this policy instrument is frequently used for inclusive growth. It promotes economic growth, reduces the GINI index, and creates more equally distributed income among the population. Therefore, achieving inclusive economic growth is more feasible for the selected EU members and candidate countries through increased capital spending or indirect taxes. Conclusions. The study found that indirect taxes can reduce income inequality with inclusive growth. Capital expenditures play a crucial role in the medium and long term in helping to achieve inclusive economic growth in a country. For developing countries, direct taxes and capital expenditures can effectively achieve inclusive growth. In contrast, developed countries can achieve similar results using a combination of tax measures and expenditures.

Bank affiliated directors and firm accounting policy: evidence from tax avoidance

PurposeWe aim to empirically investigate the effect of affiliated banker directors (ABDs) on corporate tax avoidance. Furthermore, we conduct cross-sectional analyses on the impact of ABDs and explore the underlying mechanisms through which ABDs might influence corporate tax avoidance.Design/methodology/approachUsing a large sample between 1999 and 2016, we empirically examine the impact of ABDs on corporate tax avoidance. We address the endogeneity concerns through an instrumental variable approach and robustness tests with alternative measures of ABDs and corporate tax avoidance.FindingsOur results demonstrate that firms with ABDs exhibit lower levels of corporate tax avoidance. This negative association persists after controlling for potential endogeneity issues and is robust to alternative measures. We further document that the negative effect is stronger when firms are more bank-dependent and financially constrained. Our results indicate that ABDs limit corporate tax avoidance by strengthening corporate governance, mitigating information risks and protecting their reputational capital.Originality/valueThis research extends the existing literature by exploring the influence of ABDs on corporate accounting policies, particularly tax avoidance. These findings enhance our understanding of how directors’ banking experience bolsters corporate governance, information transparency and reputation, ultimately safeguarding stakeholder interests. This paper offers valuable implications for both financial practitioners and policymakers.

Shadow Economy of the Middle East and Assessment of the Effectiveness of Measures for Taxation of Hidden Income

Objectives: The study aims to analyze the shadow economy in Middle Eastern countries, exploring its impact on socio-economic development and fiscal policy. It seeks to evaluate taxation measures for hidden income and propose strategies to mitigate shadow economy activities. Methods: The research employs analysis and mathematical modeling to examine the relationship between the shadow economy and fiscal policy. A regression model was constructed to study the dependence of tax revenue effectiveness on the strength of legal regulations, with 82% of changes in tax revenues explained by changes in legal measures. Results: The findings reveal an inverse relationship between the shadow economy's size and the effectiveness of fiscal policies in Middle Eastern countries. The persistence of shadow economic activities undermines tax revenues, while poor living standards, poverty, and limited social development further exacerbate the issue. The study identifies key areas for improvement, such as broadening the tax base, increasing tax rates, legalizing income, and regulating informal activities. Conclusion: The shadow economy significantly hampers socio-economic development in the Middle East. Strengthening fiscal policy through better legal frameworks, effective taxation measures, and regulation of informal economic activities is essential for reducing the shadow economy's size and fostering sustainable growth in the region.

Залучення іноземних інвестицій для повоєнної відбудови: досвід країн Західних Балкан

The article is dedicated to summarizing and comparing the experience of attracting foreign direct investment (FDI) for post-war reconstruction in the Western Balkans and its significance for Ukraine amid ongoing military aggression and the need for post-war rebuilding. It characterizes the experiences of Croatia, Serbia, Bosnia and Herzegovina, Albania, Montenegro, North Macedonia, and Kosovo, which suffered destruction during the Yugoslav wars in the Balkans and used FDI as a key tool for economic recovery. The paper examines legislative, tax, institutional, and infrastructural measures aimed at attracting foreign capital, including the establishment of free economic zones, support for small and medium-sized enterprises, tax reductions, and subsidies. The importance of legal protection, political stability, and anti-corruption measures for creating a favorable investment environment is argued. Additionally, the article highlights the critical role of international organizations such as the World Bank, the European Bank for Reconstruction and Development (EBRD), the European Investment Bank (EIB), and the United Nations Development Programme (UNDP), which provided funding for infrastructure projects and institutional reform. Their involvement contributed to the reconstruction of key economic sectors and prepared the countries for European integration. The Balkan experience is valuable for Ukraine, as the current challenges and reconstruction needs after the war share similar features. Ukraine can leverage the tools and approaches of the Western Balkan countries to develop its strategy for attracting FDI, including European integration processes, legal system improvements, anti-corruption reforms, and the stimulation of domestic investment.

A Method for Assessing Urban Industrial Ecological Efficiency Using SBM-GML Model with Tax Reduction

The industrial development of cities promotes social and economic development, but it also affects cities' ecological environments. To balance the relationship between the two, the country introduces corresponding tax reduction policies as an effective means of regulation. Therefore, to explore tax and fee reduction policies' specific impact on urban industrial ecological efficiency, the proposed text clustering model was first used in this experiment to cluster the tax and fee reduction policies issued by the government. Subsequently, the Slack-Based Measure-Global Malmquist Lunberger was constructed to measure urban industrial development's ecological efficiency. These experiments confirmed that policy text clustering models had different clustering accuracy on different datasets, with clustering accuracy reaching up to 80.95%, 87.13%, and 94.08% at iterations of 200, 500, and 1000. The regression coefficients for the main variables obtained from the clustering policy, including overall tax reduction and fee reduction, circulation tax reduction, income tax reduction, social expense reduction, and technological innovation tax reduction, were 0.117, 0.105, 0.269, 0.112, and 0.115, respectively. This indicated that these tax and fee reduction measures affected industrial ecological efficiency positively. Therefore, the proposed method can effectively cluster policy texts and measure the industrial ecological efficiency of cities, which has practical feasibility. This provides an effective path for promoting industry and the ecological environment's balanced development. Doi: 10.28991/HIJ-2024-05-04-02 Full Text: PDF

De-normalizing sugar-sweetened beverage consumption: effects of tax measures on social norms and attitudes in the California Bay Area

BackgroundSocial norms can influence individual health behaviors. Shifts in social norms for smoking were critical for the effectiveness of tobacco control efforts such as excise taxes. Sugar-sweetened beverage (SSB) excise taxes have been implemented in municipalities across the United States to reduce SSB intake and improve health. We sought to identify trends in social norms and attitudes about healthfulness of sugar-sweetened beverage (SSB) consumption in the California Bay Area and examine whether social norms and attitudes changed following SSB taxes.MethodsData came from annual (2016–2019, 2021) cross-sectional surveys (n = 9128) in lower-income neighborhoods in Oakland, San Francisco, Berkeley, and Richmond. We assessed overall trends and compared pre-post tax changes in Oakland and San Francisco with comparison cities.ResultsWe observed a 28% reduction in social norms for SSB consumption (people’s perceptions of peers’ consumption) and variable reductions in attitudes about the healthfulness of SSBs. Relative to comparison cities, post-tax, perceptions of peers’ consumption of sports drinks declined in Oakland; attitudes about the healthfulness of sugar-sweetened fruit drinks declined in San Francisco.ConclusionsAmong lower-income populations, social norms and attitudes towards the healthfulness of SSBs meaningfully declined over time, with smaller tax-related effects. SSB taxes as well as the local media attention they generate appear to affect people’s perceptions of SSBs. Pairing SSB taxes with messaging campaigns may be more effective in de-normalizing SSB consumption.

Smoking status and interventions among children and adolescents in China

Abstract. Tobacco use is the leading cause of preventable death globally. China is the Worlds large tobacco-producing and consuming country, and the burden of death and disease caused by tobacco use will continue to increase .The "Healthy China 2030" Planning Outline proposes to reduce the smoking rate of the population over the age of 15 to 20% by 2030. Taxation and price measures are recognized as the single most effective tobacco control policy measures. A variety of interventions are needed for adolescents, including China can carry out tobacco control according to the comprehensive tobacco control policy of WHO MPOWER (monitor,protect,offer,warm,enforce,raise),smoking ban in public places, cigarette sales to minors, prohibiting advertising promotion, raising the tobacco tax, adding health warnings to the cigarette packaging, use new media to expand coverage.

The Impact of the COVID-19 Pandemic on Taxpayers in Nigeria

There is no doubt that the outbreak of the Coronavirus disease (COVID-19) strikes the world with unparalleled disruption in economic and business activities. The impacts of the COVID-19 pandemic have dealt a serious blow to businesses, households, individuals, and revenue generation by governments across the globe with Nigeria being no exception. As a result, Nigeria introduced certain tax measures through the Emergency Economic Stimulus Bill 2020 to mitigate the impact of the pandemic on taxpayers but these measures are inadequate and in some ways impracticable. The measure includes a temporary relief to companies and individuals to alleviate the adverse financial consequences of a slowdown in economic activities as a result of the COVID-19 pandemic. The article argues that it is clear that the COVID-19 pandemic has drastically reduced business activities and the Bill does nothing to reduce or remove the existing tax burden but simply postpones the same to a later date. This negates section 14(2)(b) of the Nigerian Constitution 1999 as amended which provides that the security and welfare of the people shall be the primary purpose of government. This raises a critical question as to whether revenue generation by the Nigerian government is more important than preventing hardships and reducing the burden of Nigerian taxpayers whose welfare the government has sworn to protect through the Constitution. The implication is that the Nigerian government needs to revise its tax regime encompassing incentives such as tax credits, write-offs, and tax holidays in a bid to provide adequate relief to the taxpayers pending the eradication of the pandemic and a return to economic stability.