Tax Policy Research Articles

The Role of Misclassification and Carbon Tax Policies in Determining Payment Time and Replenishment Strategies for Imperfect Product Shipments

The study constructed a supply chain inventory model for sellers and buyers that integrates payment-time-dependent demand, product defects, misclassification risks, and carbon emission tax considerations. The model was designed to optimize payment time, replenishment time, and order quantities to maximize the seller’s profit per unit time. Theoretical analysis showed that profit exhibited joint concavity with respect to both payment time and replenishment time. An algorithm was also formulated to derive optimal solutions. Finally, numerical experiments and sensitivity analyses validated the model and offered practical insights for managing inventories involving imperfect products. Results indicated that higher responsiveness of demand to payment timing, greater demand coefficients, better product prices, and higher scrap values led to increased seller profits, while greater misclassification, credit default risks, and carbon tax rate reduced it. These insights help decision-makers select suitable parameter values for efficient operations.

Politicians and Tax Policy: The Role of Preferences and Beliefs

Politicians and Tax Policy: The Role of Preferences and Beliefs

Study on the Mechanisms through which Macroeconomic Policies Affect Real Estate Market Price Volatility

This study analyzes how macroeconomic policy tools such as monetary policy, fiscal policy, and tax policy affect the real estate market through various channels. The study finds that monetary policy influences real estate demand and, consequently, price fluctuations by adjusting interest rates and credit supply. Fiscal policy, through government spending, tax incentives, and housing subsidies, adjusts market demand and supply, thereby impacting price volatility. Tax policies, particularly property taxes and land taxes, exert a profound influence on the real estate market by altering market expectations and investor behavior. By constructing a theoretical framework and analyzing policy mechanisms, this research uncovers the complex relationship between macroeconomic policies and real estate market price fluctuations and provides relevant policy recommendations. The study concludes that the effectiveness of these policies depends on their timeliness, coordination, and the execution capacity of local governments. Finally, the paper looks forward to future research directions, particularly in the areas of diversified policy combinations, market expectation management, and the application of digital technologies.

Research on Financial Risks and Compliance Challenges in Cross-Border Mergers and Acquisitions

With the acceleration of global economic integration, cross-border mergers and acquisitions (M&A) have become an important strategic tool for companies to expand international markets and optimize resource allocation. However, the complexity and uncertainty of financial risks and compliance issues in the process of cross-border M&A pose significant challenges to the success of M&A transactions. This paper systematically analyzes the main types of risks and their interactions in cross-border M&A from the perspectives of financial risks and compliance. Through specific case studies, this paper reveals the constraints imposed by the legal systems, tax policies, and antitrust laws of different countries on the success of M&As and proposes effective risk management and compliance control strategies. The research findings indicate that financial risks and compliance risks in cross-border M&A are interrelated, and companies should consider both types of risks in the M&A decision-making process. By establishing an effective risk management framework and compliance review mechanism, companies can reduce the likelihood of M&A failure. This study provides a theoretical basis for risk management and compliance control in cross-border M&A and offers guidance for M&A decision-makers in practice.

Analysis of the Financial Performance Management Path of Enterprises under Green Tax Policy

Under the backdrop of green tax policies, companies face new challenges and opportunities in financial performance management. This paper explores the direct and indirect impacts of green tax policies on corporate financial performance management, highlighting the main issues companies encounter during their green transformation from three aspects: performance evaluation systems, information disclosure supervision, and green investment. In response to these issues, the paper further proposes optimization paths for corporate financial performance management. The aim is to provide guidance for companies to promote green transformation through economic means and to offer decision-making support for governments in formulating relevant green development policies.

CARBON TAX REGULATION IN INDONESIA: A COMPARATIVE REVIEW WITH SINGAPORE

Climate change presents an urgent global challenge, prompting countries to adopt emission reduction strategies in accordance with the Paris Agreement. One such strategy is the implementation of a carbon tax to reduce greenhouse gas emissions and promote sustainable development. Indonesia and Singapore, as signatories to the Paris Agreement, have both introduced carbon pricing policies with differing legal and institutional frameworks. This study analyzes and compares the carbon tax regulations in Indonesia and Singapore to evaluate their alignment with climate commitments and identify practical lessons for Indonesia. The objective of this research is to examine the carbon tax regulations in both countries and identify aspects of Singapore's carbon tax policy that could serve as a lesson for Indonesia in formulating a more effective policy. This study employs a normative juridical method with a comparative approach and a statutory approach. The findings indicate that Indonesia’s carbon tax, introduced through Law Number 7 of 2021, represents an initial step toward achieving national climate targets. However, the policy is still limited in scope and lacks certainty in rate progression, coordination between institutions, and enforcement mechanisms. Conversely, Singapore’s Carbon Pricing Act 2018 provides a more structured and transparent system. It includes specific emission thresholds, gradually increasing tax rates, centralized reporting, and strict enforcement backed by legal sanctions. Therefore, Indonesia can draw lessons from Singapore in terms of policy design, institutional framework. These include establishing a clear carbon tax roadmap, improving inter-agency coordination, developing a centralized monitoring and reporting platform, and implementing firm sanctions for non-compliance.

Regulatory Challenges of Cryptocurrency Adoption in Corporate Finance

ABSTRACT Cryptocurrency adoption in corporate finance presents significant opportunities for innovation, efficiency, and diversification, yet it is accompanied by complex regulatory challenges, especially in the Indian context. This study explores the regulatory barriers impeding the integration of cryptocurrencies within Indian corporate finance, focusing on key issues such as legal ambiguity, taxation policies, compliance requirements, and investor protection. Using a mixed-methods approach, data was collected from 30 corporate finance professionals through structured surveys and qualitative interviews. The findings reveal that regulatory uncertainty, particularly the lack of a unified legal framework and fluctuating government policies, is the foremost obstacle limiting corporate adoption of cryptocurrencies. High taxation rates and the non-deductibility of losses further discourage corporate participation, while compliance with anti-money laundering (AML) and know-your-customer (KYC) norms presents operational challenges. Comparative analysis with global regulatory frameworks highlights India’s need to align with international best practices to foster a more supportive environment. The study also identifies corporate strategies for mitigating these challenges, such as enhanced due diligence and technology adoption. Based on these insights, the research recommends policy reforms aimed at clarifying regulatory guidelines, rationalizing tax policies, and strengthening investor protections. These measures are essential to balance innovation with financial stability and enable Indian corporations to harness the full potential of cryptocurrencies in their financial operations. This study contributes to the growing body of knowledge on digital asset regulation and offers practical guidance for regulators and corporate managers alike. Keywords: Cryptocurrency, Corporate Finance, Regulatory Challenges, Taxation, Compliance

Faktor-Faktor Yang Mempengaruhi Tax Avoidance Perusahaan Pertambangan

This study aims to examine the factors that influence tax avoidance in mining companies listed on the Indonesia Stock Exchange for the period 2021–2023. These factors include corporate governance (independent commissioners, audit committees, and managerial ownership), company performance (leverage and profitability) and corporate social responsibility (CSR) disclosure. This study uses a quantitative approach with secondary data in the form of annual reports and company sustainability reports. Data analysis uses panel data regression analysis with Stata software version 17. The results of the study show that profitability has a positive effect on tax avoidance. Meanwhile, corporate governance, leverage, and CSR disclosure have no effect. This finding indicates that company profitability can be an important indicator of tax avoidance tendencies. Therefore, these results can be used as a consideration for tax authorities in improving supervision, as well as for company management in implementing more responsible tax policies.

Impact of Taxation on Investment for Mobile Network Operators in Zimbabwe

Using panel data of Mobile Network Operators in Zimbabwe, this paper investigates the impact of taxation on investment in the telecommunications industry in Zimbabwe. Using Dynamic Panel Data Models to address the heterogeneity of the individual telecommunication operators and by the use of lagged variables as instruments to deal with endogeneity, we find statistically strong evidence of a negative impact of taxation on investment by Mobile Network Operators. An increase in excise duty by 1 percent reduces investment by Mobile Network Operators by 0.13 percent. Relatedly, an increase in Value Added Tax by 1 percent reduces investment by 1.6 percent. Furthermore, based on a model with endogenous independent variables with six lags of the investment variable, an increase in Mobile Network Operators’ revenue by 1 percent increases investment by 2.2 percent. From a policy perspective, the results give a further and deeper understanding of the complex and dynamic relationship between tax regulations and strategic decision-making in the telecommunications industry and inform evidence-based policymaking. The impact of taxation in the telecommunications sector is a multi-pronged issue that needs to be structured around not only the benefits it generates to the government but also the costs it causes to users, licensed operators and the economy in general. The findings help to illuminate the importance of adopting context-specific approaches to tax policy design, administration and reform. By combining empirical evidence and practical implications, this research contributes to a deeper understanding of the dynamics shaping tax systems in the telecommunications sector. Scope still exists for further interrogation by extending the analysis to Internet Access and Service Providers.

Does Democracy Affect Income Distribution? Preliminary Evidence for OECD Countries

ABSTRACTThe article poses and attempts to address the question of whether, how, and to what extent political democracy influences income distribution and, more broadly, economic inequality in current Western and comparable societies such as OECD countries. It first reviews the sociological and related literature concerning the relations between political democracy and economic inequality, including income and wealth distribution. Considering theoretical arguments and empirical observations, it then states hypotheses concerning the influence of political democracy on income distribution and specifies the data, methods, and variables of the empirical analysis. It presents the findings of empirical exploratory and regression analyses. Last, it discusses the findings and offers conclusions and directions for further research. The findings largely corroborate the hypotheses that political democracy inversely relates to, and negatively influences, income distribution by providing preliminary, suggestive, though not conclusive, definitive evidence for this.Related ArticlesAdegboye, A., K. Adegboye, U. Uwuigbe, et al. 2023. “Taxation, Democracy, and Inequality in Sub‐Saharan Africa: Relevant Linkages for Sustainable Development Goals.” Politics & Policy 51, no. 4: 696–722. https://doi.org/10.1111/polp.12547.Nchofoung, T., S. Asongu, V. Tchamyou, and O. Edoh. 2022. “Gender, Political Inclusion, and Democracy in Africa: Some Empirical Evidence.” Politics & Policy 51, no. 1: 137–55. https://doi.org/10.1111/polp.12505.Wang, Y. 2017. “Why Tax Policy Is Not Politics in China: Public Finance and China's Changing State‐Society Relations.” Politics & Policy 45, no. 2: 194–223. https://doi.org/10.1111/polp.12200.

The Impact of Fiscal Policies on Corporate Investment Strategies and Stock Market Performance

This paper examines the relationship between fiscal policies and their impact on the private sector and stock market fluctuation particularly focusing on the difference in the reaction between developed and developing countries. It is based on secondary data focusing on case studies of key policy movements in recent years and their impact on the private sector and financial market. This included utilizing published data, academic journals, government economic reports, stock market performance indices, and corporate financial statements. The findings indicate a significant relationship between fiscal policies, both through tax policy changes and government expenditure, on corporate investment decisions. However, this relationship is also affected by factors like market conditions, economic growth, etc. Similarly, significant stock market volatility has been observed post-fiscal policy announcements. Other factors affecting stock market performance include investor’s psychology, long-term predictions, etc. Notably, developed economies generally observe fewer fluctuations after fiscal policy announcements and implementation as compared to emerging economies.

ECJ Rulings on VAT Exemptions in Gambling: A Step Toward Fiscal Neutrality?

The EU VAT exemption on gambling revenues involving monetary stakes, aiming to prevent excessive regulatory burdens on operators, was reinforced in two ECJ’s rulings (Casino de Spa and Others and Chaudfontaine Loisirs). These decisions underscore the complexity of VAT compliance for gambling businesses and highlight the ongoing tension between EU-wide principles, such as fiscal neutrality and national regulatory autonomy in the context of gambling tax policies.

Tax Amnesty and Policy Innovation: Assessing the Case of Vivad Se Vishwas Scheme in India

Tax Amnesty and Policy Innovation: Assessing the Case of Vivad Se Vishwas Scheme in India

Tax Policy and Music Education in Portland, Oregon, 1990–2017

In this study, I used historical case methodology to analyze the conditions of music education in the Portland (Oregon) Public Schools (PPS) between 1990 and 2017. In 2008, city leaders discovered that only 25% of PPS schools had any arts instruction and developed the Arts Tax to increase staffing for those subjects in the public elementary schools. The primary purpose of this study was to help explain why city leaders felt the Arts Tax was necessary policy. I utilized both primary source archives and interviews of former and current teachers to complete a timeline of events that help explain the conditions city leaders found in 2008 and the remediation process that followed. The analysis includes narratives of the budget cut process, behavior of stakeholders, and exploration of policies that affected PPS music programs. Emergent themes were arranged chronologically according to the timeline and included budget cuts, response to budget cuts, and site-based management. An ad hoc policy analysis provided evidence that site-based management had an indirect but substantial effect on the outcomes for PPS music programs at all grade levels.

Corporate Taxation and Subsidy Distortions as Barriers to Private Domestic Investment in Serbia

This paper examines the structural barriers to private domestic investments in Serbia, with a particular focus on the role of corporate taxation and subsidy policy. The analysis combines descriptive empirical data, comparative legal assessment, and institutional diagnostics to explore why domestic investments have remained persistently low relative to both foreign direct investments and levels observed in comparable EU economies. Using Eurostat and World Bank data for the period 2013–2022, the paper documents that total investment growth in Serbia has been primarily driven by rising FDI inflows and increased public investments, while domestic private investments have remained weak. Despite a relatively high fiscal effort devoted to investment incentives, including both tax-based instruments and direct subsidies, the design and allocation of these measures appear to disproportionately benefit large investors – most often foreign. The paper contextualises Serbia’s statutory and effective corporate tax rates within EU norms and identifies significant structural asymmetries in incentive accessibility between firms of different sizes. It also develops a classification of corporate tax incentive regimes in selected EU member states and Serbia, based on the structure and conditions of tax-based investment support, which is used to assess Serbia’s position relative to prevailing EU practices in the design of fiscal incentives. Institutional barriers, including legal uncertainty and administrative inefficiency, further constrain domestic investments. The findings suggest that Serbia’s current investment model is unlikely to support sustainable long-term development unless policy is rebalanced to improve the investment climate for domestic firms. The findings inform policy recommendations aimed at rebalancing incentive structures and strengthening institutional and financial conditions for domestic investments.

A legal battle between Ecuadorian citizens and corporate power.

For decades, transnational corporations/companies have been using various strategies (e.g. lobbying for the reduction of taxation) to position their products and influence dietary habits, particularly in low- and middle-income countries. According to the World Health Organization (WHO), 'health taxes' are one of the most effective public health measures for reducing the negative effects of unhealthy products, which have been shown to add to the burden adiposity-related cardiovascular diseases, cancers, and diabetes mellitus. Yet despite the abundant evidence on these impacts and the innovative tax policies implemented by neighbouring countries, on 10 January 2023, Ecuador issued Decreto 645 - an unprecedented presidential decree which reduced excise taxes on products harmful to health and the environment, including cigarettes and e-cigarettes, alcoholic beverages, sugary industrial drinks, plastic covers, firearms, and ammunition. The rationale for this government decree was to strengthen citizen security, fight against smuggling and informality, and mitigate the impact of inflation on the economy. In this viewpoint, we share the experience of how members of the civil society built a group called Colectivo Todos Por la Vida (translated as 'Collective All for Life') and led a legal fight to defend the health and well-being of the Ecuadorian population against local corporate power. The lessons learned could be useful to other countries in similar scenarios.

Dynamics of Tax Aggressiveness: Audit Committee Moderation on Corporate Characteristics

Tax aggressiveness is a major concern for policymakers and corporate governance stakeholders because of its impact on state revenues and corporate financial strategies. This study aims to evaluate the influence of company size, capital intensity, and CSR on tax aggressiveness, with the audit committee as the moderation variable. This study adopts a quantitative method using secondary data from industrial sector companies listed on the IDX during the period 2021 to 2023. To analyze the relationship between variables, multiple regression techniques and MRA were used. The results show that capital intensity has a negative impact on tax aggressiveness, which shows that companies with large investments in fixed assets tend to have lower levels of tax aggressiveness due to depreciation benefits. However, company size and CSR did not show a significant influence on tax aggressiveness, contrary to some previous research findings. In addition, the audit committee was proven to significantly moderate the relationship between capital intensity and tax aggressiveness, emphasizing the importance of corporate governance roles in overseeing tax policies. However, the audit committee's moderation of the relationship between company size and CSR with tax aggressiveness did not show significant results, indicating that additional governance mechanisms may be necessary. The results of this study enrich the literature related to tax strategies and corporate governance and offer implications for regulators, company executives, and investors in developing more effective policies to increase transparency and tax compliance.

Cross-country analysis of aggregate markups and their impact on income inequality.

Background This study investigates the connection between aggregate markups and income inequality, exploring how market power affects inequality in developed, emerging, and developing economies. The analysis aims to reveal how institutional differences and economic systems shape this relationship. Method The study examines data from 12 countries from 1997 to 2016 using a panel data approach. The analysis focuses on key variables such as the Gini index (measuring inequality), lagged markups, trade openness, GDP per capita, tax revenue, poverty, and R&D expenditure. A two-way fixed-effects model is applied to account for country and year-specific differences, while robust standard errors ensure reliability. Results The results show that higher markups are closely linked to greater income inequality, with the impact being particularly pronounced in emerging and developing economies. Integrating tax policies, trade openness, and GDP growth into the analysis indicates the limitations of relying solely on economic growth to achieve equity. The research highlights taxation and trade as effective levers for mitigating inequality and raises important questions about the role of innovation in this dynamic. Conclusion This study shows the interaction between market power and inequality across diverse economic systems. We examine how factors like market concentration and institutional quality drive inequality provides practical insights and policy recommendations for effectively addressing income disparities.

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.

Comparison of Fiscal Policy Cyclicality Models in Foreign Countries

The article is devoted to the issues of fiscal policy cyclicality in foreign countries. The purpose of the article is to explore the features of the fiscal policy cyclicality of some federal countries - representatives of the “group of twenty” for the period from 1971 to 2022. The objective predetermined the setting of the following tasks: to analyze the cyclicality of fiscal policy by expenditures, to analyze the cyclicality of tax policy, as well as to compare the obtained results to identify common patterns of cyclicality for countries with a similar level of economic development. The study of fiscal policy cyclicality is relevant because it allows governments to adjust their fiscal policies according to the current state of the economy. This helps to smooth out fluctuations in economic activity and reduce the risk of recessions. Research methods - econometric modeling (building a linear regression model and using pooled binary least squares estimation), comparison, analysis. Main results of the study: the procyclicality of the public expenditure policy is confirmed in all the countries studied over the period considered, and it has an inverse dependence on the level of economic development of the country (the higher the level of development of the country in the period considered, the less procyclical its expenditure policy). The fiscal policy of all countries under consideration is countercyclical in terms of VAT, corporate and individual income taxes, but the degree of countercyclicality is different everywhere. The novelty of the study is the construction of a dynamic model without a free term, as well as the inclusion in the analysis of periods of global financial crisis, pandemic, the current stage of technological mode change and geopolitical bifurcation. The practical significance of the study lies in the possibility of balanced development of territories: in federal countries, where there are different levels of economic activity and income in different regions, the establishment of the type of cyclicality of fiscal policy allows a more even distribution of tax and budgetary resources to support the sustainable development of all regions.