Tax Reform Research Articles

Taxpayer response to greater progressivity: evidence from personal income tax reform in Uganda

Taxpayer response to greater progressivity: evidence from personal income tax reform in Uganda

The Impact of Environmental Protection Tax Reform on Corporate Performance: An Empirical Analysis in China

The Impact of Environmental Protection Tax Reform on Corporate Performance: An Empirical Analysis in China

Analysis of the Impact of Value-added Tax Reform on the Financial Cost Structure of Enterprises

Analysis of the Impact of Value-added Tax Reform on the Financial Cost Structure of Enterprises

Tax System Optimization: A Comparative Analysis Between Personal Income Tax and Corporate Income Tax in Indonesia

This study adopts a qualitative approach to analyze the comparison between Personal Income Tax (PPh) and Corporate Income Tax (PPh Corporate) in Indonesia. Through literature studies and observations, this study explores the tariff structure, tax relief, and tax compliance level of the two tax systems. The economic implications of the implementation of Income Tax and Corporate Income Tax on economic growth, investment, and income distribution were also discussed. The findings show that tax reform, as stated in the Law on Harmonization of Tax Regulations (UU HPP), has a significant impact in improving the effectiveness and fairness of the tax system. The results of this study provide in-depth insights into the importance of appropriate tax policies to support inclusive and sustainable economic growth in Indonesia.

Recuperation mechanism of direct taxation to control post covid economic contraction: India’s new tax reform with crypto tax

This study explores the impact of the progressive tax structure on income equality, emphasizing the significance of direct taxes in promoting economic and social equality. It also examines the challenges faced by the Indian government in meeting its revenue targets due to the decline in corporation tax and personal income tax revenues. The present study assesses the role of the newly implemented tax by the Indian Finance Ministry on capital gains from the sale or purchase of cryptocurrencies and its impact on economic growth. A qualitative approach has been adopted, utilizing secondary information sources for characterization and analysis. The study relies on Time Series Data from the Income Tax Department for the financial years 2000-01 to 2018-19 and global estimates of total tax revenues published by the International Centre for Tax and Development (ICTD). The findings indicate that the substantial decline in direct tax revenues necessitated a search for alternative sources of income. The separate taxation system for cryptocurrencies has legitimized digital assets and enabled the government to monitor transactions and capital gains. The introduction of the "Digital Rupee" aims to enhance the digital economy through efficient currency management. This research highlights the need for policymakers to develop a well-defined regulatory framework for cryptocurrency taxation. Clear regulations on cryptocurrency taxation and the "Digital Rupee" could help India boost its digital economy while ensuring better monitoring of crypto transactions and revenues.

Land Stewardship and Development Behaviors Under an Ecological-Impact-Weighted Land Value Tax Scheme: A Proof-of-Concept Agent-Based Model

Sprawling land development patterns have exacerbated ecological degradation, social fragmentation, and public health problems. Perverse incentives arise from the ability to privatize collectively created value in land rents and socialize ecological costs. Land value taxation (LVT) has been shown to encourage urban infill development by reducing or eliminating rent-seeking behavior in land markets. However, despite its purported benefits, this tax reform is value monistic in its definition of optimal land use and, therefore, does little to address the lack of non-market information to inform land use decisions. We propose an ecological-impact-weighted land value taxation policy (ELVT) which incorporates the ecological footprint of land use into one’s land value tax burden. We test both proposed policies (LVT and ELVT) relative to a “status quo” (SQ) property tax scheme, utilizing a conceptual spatially explicit agent-based model of land use behaviors and housing development. Our findings suggest that both tax interventions can increase the capital intensity and decrease the land intensity of housing development. Furthermore, both tax interventions can lead to a net profit loss for speculators and a decrease in the average housing unit price. The ELVT scheme is shown to significantly increase urban nature provisions and dampen the loss of ecological value across a region.

Final tax regression

The urgency of this research lies in the pressing need to address regressiveness in Indonesia's taxation system, particularly concerning the Final Income Tax. As such, this study aims to examine the implications of Final Income Tax on taxpayers, especially high-income individuals, and propose potential reforms to ensure fairness and progressivity in the tax regime. To achieve this objective, the research employs a combination of quantitative analysis and theoretical frameworks. Income data from High-Wealth Individuals (HWIs) is analyzed to assess the regressiveness of the Effective Tax Rate (ETR), with a specific focus on income components subject to Final Income Tax. Additionally, the study reviews existing literature on tax reform and draws insights from international best practices to formulate recommendations for policy improvements. By combining empirical analysis with theoretical insights, this research contributes to a deeper understanding of the challenges within Indonesia's taxation system and offers actionable recommendations for policymakers and Directorate General of Taxes as Indonesian tax authorities.

Gaya komunikasi kepemimpinan transformasional dalam masa perubahan organisasi: Sebuah tinjauan literatur

The Directorate General of Taxes (DJP) is undertaking Tax Reform Volume III, which encompasses a focus on the reform of Human Resources (HR). The management of organizational change is inherently complex, and issues persist regarding the dynamics between superiors and subordinates at DJP. This study aims to furnish insights into change management from a communicative standpoint, specifically identifying the most suitable leadership communication styles to implement during the change process. The research employs a literature review methodology. Findings reveal that the transformational leadership communication style is the most effective for managing change. Communication styles that are devoid of emotional bias, empathetic, and allows for two-way communication are generally favored by subordinates. Training aimed at enhancing leadership communication competencies represents a feasible solution to equip individuals with the necessary skills to cultivate an optimal work environment

Trying to find a balance: Energy excise duties in the context of climate targets, energy shocks, and redistributive goals

This study examines the implementation of an environmental tax reform in Italy, focusing on changes in excise duties on petrol, diesel and electricity. The reform is in line with the revised European Energy Tax Directive and aims to support European climate objectives. The main motivation of this research is to show how the additional revenues generated by the environmental reform can be used to mitigate its regressive impact on low-income households through cash transfers. The analysis uses a microsimulation model based on data from the Household Budget Survey. The environmental reform combined with the cash transfer is implemented for 2019 and 2022, this latter being a year significantly affected by the energy crisis. The results confirm the inherent regressivity of the environmental tax reform when considered in isolation, but they also reveal significant positive redistributive effects achieved by paying monetary transfers to households in the lowest three income deciles. In this case, the reform enhances redistributive outcomes that remain effective even when the structure of the transfers is modified. The paper also highlights the limited redistributive impact of the 2022 excise tax cuts on fuel, which aimed to address the regressive effects of the energy shock. Again, a targeted cash transfer would have been more effective for low-income households.

The economic effects of tax structure transformation: A study based on the tax reform of China's hainan free trade port

Many developing countries use tax reform as a strategy to support national or regional development. China's tax reform of the Hainan Free Trade Port in 2025 serves this purpose. The reform replaces the existing VAT, consumption tax, vehicle purchase tax, urban maintenance and construction tax, and education fee ("four taxes and one fee") with a sales tax. Previous studies of tax structure reform have rarely addressed the economic impact of such a transition, and few sales tax studies have discussed the issue of optimal tax rates. To study the economic effects of the introduction of sales tax and to find the optimal tax rate, this paper uses the computable general equilibrium (CGE) model to conduct simulation analyses. It is found that the sales tax rate should be 17.16 % to keep the fiscal revenue of Hainan Province more or less unchanged after the ‘four taxes and one fee’ are simplified into sales tax. The total economic volume and sales tax rate show an inverted ‘U’ type relationship, the optimal sales tax rate is about 9.79 %, and the tax rate of GDP, investment, employment growth of 3.82 %, 0.35 %, 3.41 %, respectively, the manufacturing industry and other industries in most of the different degrees of growth. Therefore, we suggest that the average sales tax rate of Hainan Free Trade Port should be around 9.79 %.

Analysis Of The Impact Of Tax Reform On Income Tax (PPH) 21 Revenue In Indonesia

This research aims to analyze the impact of tax reform on Income Tax (PPH) 21 revenues in Indonesia. Tax reform was carried out by the government to increase efficiency and fairness in the tax system. The main focus of this research is identifying tax policy changes that have been implemented and analyzing how these changes affect PPH Article 21 revenue. This research uses a qualitative approach with descriptive methods, while the type of research uses literature study research to analyze tax policy, as well as the impact of tax reform on revenue. PPH Article 21. It is hoped that the results of this research will provide a better understanding of the effectiveness of tax reform in increasing income tax revenues from high-income employees.

Consideration of the Application and Risk Prevention of VAT Tax Rebate Policy for Construction Enterprises at the End of the Period

The “Announcement on Deepening the Value-Added Tax Reform” clearly outlines the preferential policy regarding incremental retention tax rebates. With the advancement of value-added tax (VAT) reform and the improvement of VAT legislation in China, VAT tax planning for construction enterprises, particularly related to retained tax credits, has become routine. This paper, focusing on the characteristics of construction enterprises, analyzes VAT retained tax credits at the end of the period, the status of tax refunds, practical issues, and related processes, and offers suggestions for policy application and risk prevention.

Earnings Responses to Even Higher Taxes

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

How redistribution can make carbon taxes more acceptable to the public

ABSTRACT Carbon taxation is a market-based, incentive-driven policy tool, and it is often recommended in mainstream environmental economics. However, it is, by design or in effect consumption taxation, meant to make high-emission products and services more expensive. When affecting consumer prices, the unintended consequence is that they affect those who earn the least the hardest. As a result, low-income groups are generally less supportive of carbon taxes. However, carbon tax reforms need not be regressive. Policy designs can include mechanisms of social compensation. In this article, we show that the popularity of carbon taxes can be improved if citizens are presented with a progressive carbon tax reform. This effect is mainly driven by higher support among low-income groups. This is tested using a split-sample experiment collected in Denmark and employing regressions to explore the differences.

Evaluating the Subject to Tax Rule in Nigeria: Implications, Challenges and Strategic Considerations Amid Global Tax Reforms

The OECD’s two-pillar solution addresses the tax challenges of digitalization, with the Subject to Tax Rule (STTR) and GloBE Rules ensuring minimum taxation. This article explores the application of the STTR in Nigeria, assessing its potential for generating revenue while considering the high costs of implementation and the country’s strategic alternatives.

Effect of Perceived Usefulness of Digitized System on Rental Income Tax Compliance Among Landlords in Makadara Constituency, Nairobi County, Kenya

Purpose: Despite the tremendous growth in real estate, the corresponding tax collection from the sector has remained low. The contribution by rental income earners has been low despite all the efforts to enforce rental income tax policies. The study examined the perceived usefulness of digitized system on rental income tax compliance among landlords in Makadara Constituency, Nairobi County, Kenya. Methodology: It was guided by a unified theory of acceptance and use of technology the study adopted an explanatory research design. The target population was 4,927 landlords in Makadara Nairobi County. The sample size of the study was 369, and the study questionnaires that were correctly filled and returned were 230. The study used primary data which was collected using structured questionnaires with close-ended questions and a pilot test was conducted to test reliability and validity. Results: The study found that Perceived usefulness of digitized system and rental income tax compliance, β=0.261 p-value =0.000<0.05. Conclusion: Based on the findings the study recommends that the KRA should launch widespread campaigns to educate landlords about the usefulness of digitized systems. Future studies could be conducted to determine the impact of tax reforms on rental income tax compliance.

Environmental protection tax reform and corporate Climate Risk Disclosure

The reform of the environmental protection tax (EPT), a crucial policy instrument for combating climate change, significantly influences corporate climate risk. Hence, a thorough examination of the connection between EPT and corporate climate risk disclosure (CRD) is essential for companies to better evaluate the risks and challenges they encounter. The findings of the research indicate: (1) EPT reform substantially boosts corporate CRD. (2) Mechanism tests demonstrate that EPT enhances corporate CRD via three pathways: increasing public environmental awareness, fostering green innovation, and improving total factor productivity. (3) Heterogeneity analysis shows that various factors such as micro-level corporate characteristics (ownership and corporate life cycle), industry features (high-tech industries and factor intensity), and macro-level aspects (urban location, size, and resource attributes) differentially affect the impact of EPT. (4) Additional analysis from the perspective of institutional investors indicates that a higher proportion of institutional investor holdings amplifies the positive effect of EPT on corporate CRD. These research conclusions aid in accurately assessing the CRD impact of EPT and provide empirical support for policy development and modification.

Relationship between Tax Reform Initiatives and Employee Job Satisfaction in the Public Sector: A Case of the County Government of Uasin Gishu, Kenya

Relationship between Tax Reform Initiatives and Employee Job Satisfaction in the Public Sector: A Case of the County Government of Uasin Gishu, Kenya

Does tax refund policy boost executive compensation?

Tax reforms have a profound impact on corporate compensation. While existing research has extensively examined the effects of tax cuts and breaks on corporate compensation, the relationship between tax refunds and executive compensation remains largely unexplored. To address this gap, this paper employs a difference-in-differences approach to investigate the causal effect of China’s value-added tax credit refund policy on executive compensation. The findings reveal that the tax refund policy increases executive compensation, primarily by enhancing net income, which lays the financial foundation for higher executive compensation. These effects also exhibit heterogeneity across corporate regions, life cycle stages, ownership structures, and executive categories. This paper is the first to explore the relationship between tax refunds and executive compensation, providing valuable insights into how external tax policies influence corporate internal incentive structures.

The Impact of Taxation on the Cost of Living: A Comprehensive Analysis

This study examines the taxation-related factors affecting Malaysia's cost of living. The rising cost of living, a persistent issue in economics and social well-being, is often linked to global challenges faced by emerging nations. Direct tax has been identified as a primary contributor to the financial strain on households, who must manage various essentials beyond food, clothing, and shelter, such as education, cellular services, and transportation. The study analyzes the relationship between seven independent variables—direct tax, unemployment rate, exchange rate, household consumption expenditure, house price index, subsidies, and net trade—and the cost of living in Malaysia, using 30 years of annual data (1992-2022) with EViews for econometric analysis. This study uses descriptive statistical analysis for the description of data, coefficient matrix analysis and regression analysis for determining the impact of dependent and independent variables. The findings show that the cost-of-living pressures are positively correlated with direct tax, housing price index, and net trade. Data was sourced from the National Property Information Centre (NAPIC), the World Bank, and the Economic Planning Unit (EPU). The analysis underscores the significant impact of direct tax on the cost of living. To mitigate this impact, governments could implement fair and progressive tax reforms, provide targeted subsidies, and promote economic growth to boost income levels. Additionally, social programs and efficient government investment can further reduce household financial burdens.