Trade Taxes Research Articles

Determinants of German firm’s adjusted effective tax rate

ABSTRACT This analysis examines firm-specific determinants of the effective tax rate of German limited liability companies. The effective tax rate is calculated by considering the local trade tax, corporate profit tax, and solidarity tax for 9,318 firms from 2020 based on the Orbis data base. Our findings demonstrate a inverse u-shape relationship between the effective tax rate and firm size. Furthermore, companies with major shareholders tend to have lower tax rates, while those with a supervisory board tend to pay higher tax rates on average. These findings are consistent with the theoretical considerations on tax aggressiveness.

THE IMPACT OF TAXATION ON INTERNATIONAL COMMERCE AND EXCHANGE RATE ON IMPORTS

The globalization of capital markets has accelerated capital movements, turning the world into one large marketplace. International trade has become an important tool in shaping the financial structure of countries. However, elements such as customs duties and import quotas play a decisive role in trade between countries. Taxes, which are a financial policy tool of countries, are used to influence foreign trade, particularly imports. One of the determining factors in foreign trade activities is the exchange rate. The purpose of this study is to examine the effect of taxes on imports and the change in the nominal exchange rate on the import volume of goods and services. In this study, which examined 20 Organization for Economic Co-Operation and Development (OECD) countries with data for the period 1999-2021 taken from the World Bank official website, the model was analyzed with the help of AR (1) Residual Random Effects Generalized Least Squares Regression Model Estimator. The analysis revealed that increases in international trade taxes and exchange rate increases reduce the import volume. This result empirically supports the conclusion that taxes on international trade and reductions in exchange rates increase import volume.

The tax revenue implication of trade liberalisation in sub‐Saharan Africa: Some new evidence

AbstractDespite the advent of trade liberalisation, trade taxes still remain a key source of tax revenues in sub‐Saharan Africa. Further trade reforms in the form of the African Continental Free Trade Area could, however, hinder output growth in the region if these reforms lead to a decline in total tax revenues. Motivated by this conundrum, this paper investigates the impact of trade liberalisation on tax revenues across a panel of sub‐Saharan African countries. The results indicate that trade liberalisation is associated with an increase in total tax revenues. Also, the reduction of import and export duties significantly increases and decreases domestic and trade tax revenues, respectively. In addition, greater urbanisation is associated with an increase in total tax revenues, while inflation decreases tax revenues.

The fiscal transformation of the Spanish Carrera de Indias in the 17th century: a reinterpretation

AbstractThis article examines the fiscal transformation of Spain's trade with Spanish America during the 17th century. It analyses the taxation of trade combined with the evolution of the Hispanic Monarchy's long-term domestic debt. To this end, the author looks at the almojarifazgo de Indias (main customs duty), its juro (annuity) obligations and the evolution of the transatlantic trade. He argues that the fall in customs revenue and the increasing non-payment of the juros issued against the almojarifazgo were neither a consequence of the alleged crisis of the Carrera de Indias nor of the higher incidence of fraud. The Crown was not interested in exerting greater fiscal pressure on the trade or fighting fraud at the customs houses of Seville and Cadiz as the increased tax revenue would have gone entirely to service the unpaid juros. Instead, the fiscal burden shifted towards extraordinary contributions that were free of juro obligations.

Effectiveness of wealth-based vs exchange-based tax systems in reducing inequality

In the so-called “fair” models of peer-to-peer wealth exchanges, economic inequality tends to reach its maximum value asymptotically. This global trend is evident as the richest continuously accumulate a larger share of wealth at the expense of others. To address the mounting issue of inequality, different strategies of taxes and redistribution are commonly employed. Our study delves into the interplay between wealth and trade (consumption) tax bases, probing their impact on wealth distribution within wealth-conservative economies. The ultimate aim is to unearth an optimal framework that adeptly curbs inequality. Through a meticulous analysis of varying tax rates and the allocation of the collected tax to the most economically vulnerable strata, we unveil a compelling pattern resembling two distinct phases. These phases delineate the most effective systems for inequality mitigation. Our findings underscore the synergistic potential of amalgamating these tax systems, surpassing the individual efficacy of each. This synthesis beckons policymakers to weave together tax rates and precision-targeted redistribution, crafting tax systems that wield the potential for tangible and substantial reductions in economic disparity.

Linking economic growth and international trade taxes in Turkey: A Fourier approach

Revenues from international trade and transactions are crucial for the economic growth and macroeconomic activity of a country. For that reason, taxes from international trade and transactions are used to proxy revenues. Moreover, industrial production index is considered to be proxied for the economic growth. In this study, these variables are used monthly for the period of January 2006 and February 2022 for Turkey. First, different kinds of Fourier based unit root tests including flexibility and fractionality have been used to analyze the data structure. Then, linear VAR and Fourier VAR models have been estimated to reach and analyze the differences of the results of impulse responses between linear and trigonometric models. Finally, linear and Fourier term included Granger Causality tests have been used to question if there would be a difference or not. When the estimations and tests having Fourier structure have been established, the tests considering it have given more different results than linear models. Briefly, it has been shown that policy makers should shift their decisions to an alternative direction.

The Sino-US trade friction would exacerbate global inequalities in achieving SDGs

Trade has given rise to global inequalities in sustainable development, while the occurrence of trade frictions between China and the US has led to changes in the global trade market landscape. Whether these changes will exacerbate disparities in sustainable development between regions remains uncertain. Quantifying the impact of changes in the trade market landscape is of significant importance in accelerating global progress towards sustainable development. Therefore, this article, based on the GTAP 10.0 database and using the GTAP model, calculates the extent to which changes in tax policies affect the global achievement of sustainable development goals (SDGs) by assessing the impact of alterations in trade patterns. The research findings are as follows: (1) The decoupling of China and the US has intensified these inequalities. Economically advanced regions have made significant progress in sustainable development compared to relatively underdeveloped regions, such as the US and Sub-Saharan Africa. (2) Regions closer to China and the US are more affected by changes in trade taxes, with economically advanced regions in close proximity to China and the US benefiting more than those farther away. (3) Environmental aspects of SDGs have shown the lowest growth rates, with marginal variations across different regions. (4) Global inequalities in achieving SDGs primarily stem from inter-regional disparities. Over time, inter-regional inequalities decrease while intra-regional inequalities increase, with underdeveloped regions experiencing higher levels of intra-regional inequality compared to developed regions. The growth in tax rates between China and the US contributes to a comprehensive increase in both inter-regional and intra-regional inequalities. Based on these conclusions, this study aims to provide a scientific basis for promoting global sustainable development and reducing regional disparities in the process.

Analysis of International Disputes over Digital Services Tax and Exploration of China’s Approach

With the continuous emergence of emerging information technologies, the digital economy is developing rapidly around the world. The global operations of multinational digital enterprises no longer rely on physical presence. The effectiveness of permanent establishment rules based on the traditional real economy settings has been questioned by market countries, which actively participate in Market countries where digital business value is created do not receive corresponding taxation rights. Multinational digital companies take advantage of loopholes in digital platforms and current tax rules to actively carry out tax planning, resulting in digital companies’ global tax burden being much lower than that of traditional companies. Tax sources cannot be fairly and reasonably distributed in the places where value is created and profits are taxed, which harms the tax interests of market countries. Against the background of slow progress in the OECD global unified solution, as a temporary unilateral measure to address the challenges of the digital economy, some countries have taken the lead in imposing digital service taxes on specific digital businesses of digital enterprises. On the basis of discussing the relevant concepts and theories of digital service tax, this article discusses the relevant concepts and theories of digital service tax, and analyzes the international development of digital service tax and the positions of various countries around the world. Further analyze the impact of digital service tax collection from three aspects: national fiscal revenue, tax trade disputes and international tax order coordination, and analyze the impact of digital service tax on digital enterprises. Then the perspective is focused on my country, sorting out and summarizing my country's relevant digital economy tax policies, and analyzing the impact of digital service tax on my country in the near term and long term based on the development of my country's digital economy. Finally, based on the previous comparative analysis and impact analysis, my country's tax system for promoting the development of the digital economy has gradually improved and actively participated in the reshaping of international tax rules, and my country's response strategies under the digital service tax have been proposed. The different levels of digital economic development between China and countries that have levied digital service taxes will inevitably lead to disharmony in the international tax order. The study found that the fiscal revenue brought by digital service tax is limited and has a certain degree of distortion effect. It is necessary to actively participate in international cooperation and make China's voice heard before reaching a consensus on international tax rules. In the long term, we should focus on the connection between the two-pillar plan and the domestic tax system, strengthen tax information exchange, improve the domestic digital tax rule system, and promote the healthy and sustainable development of my country's digital economy.

IMPACT OF EXPORTS AND TRADE TAXES ON INDONESIA'S ECONOMIC GROWTH

This research endeavors to comprehensively investigate the intricate dynamics between the export of goods and services, as well as international trade tax receipts, encompassing import and export duties, and their collective impact on the economic growth trajectory of Indonesia over the period spanning from 1985 to 2019. The study meticulously employs secondary data gleaned from reputable sources such as the World Bank and the Ministry of Finance. Utilizing the robust analytical framework of the Error Correction Model within a linear regression analysis, this research delves into the nuanced relationships and temporal aspects that underscore the interplay between these critical economic variables. The findings of this study unveil compelling insights into the long-term effects of exports, import volumes, and the revenues generated from import and export duties on the overall economic growth of Indonesia. Notably, the research establishes that, over the extended time horizon, these variables exhibit a statistically significant influence on economic growth. However, the short-term dynamics present a nuanced picture, as the study reveals that, in the immediate context, neither exports nor import and export duties manifest a discernible impact on economic growth. In conclusion, this research contributes to the existing body of knowledge by shedding light on the multifaceted relationships between key components of international trade and economic growth in Indonesia. The implications of these findings extend beyond the confines of this specific study, providing valuable insights for policymakers, economists, and stakeholders seeking a deeper understanding of the intricate economic landscape.

Foreign Trade Taxes as an Instrument of Customs Policy of Ukraine in The Light of Modern Trends and Challenges

Foreign Trade Taxes as an Instrument of Customs Policy of Ukraine in The Light of Modern Trends and Challenges

Research on Olympic Games Hosting Scheme Based on Comprehensive Evaluation and Grey Prediction Model

Owing to the confluence of financial, environmental, and societal pressures confronting both the host city and nation, the allure of bidding for the Olympic Games across diverse global regions is experiencing a discernible wane. In an effort to proffer a structured framework for Olympic Games bidding, this paper undertakes an initial phase of indicator selection and subsequent determination of their respective weights. We have meticulously curated a selection of the utmost fitting cities to serve as potential hosts for the grandeur of the Summer Olympic Games across the global stage. This intricate process is achieved through the confluence of methodologies including the Delphi Method, the Analytic Hierarchy Process (AHP), and the EWM-TOPSIS Method. Subsequently, guided by the Comprehensive Evaluation Model, the study identifies a pair of fitting global locales poised for the enduring stewardship of the summer and winter Olympic Games. This paper culminates in scrutinizing the feasibility of the proposed scheme. This scrutiny takes the form of an inquiry into both immediate and prolonged repercussions of the Olympic Games upon the host city or nation. Parameters of Real GDP per capita, the proportion of international trade taxes, and carbon emissions are dissected, employing the discerning capabilities of the GREY Model. The outcomes of this inquiry distinctly underscore the efficacy of the strategy involving a fixed hosting address, bolstering affirmative developmental trajectories for the host locale. This study bears substantial reference value for the Olympic Organizing Committee in its pursuit of identifying a fresh and distinctive Olympic venue.

Manuscripta varsoviana: Instruction of the Starostwo trade tax in Warsaw in 1683

Manuscripta varsoviana: Instruction of the Starostwo trade tax in Warsaw in 1683

Die Ertragsteuerbelastung von Kapitalgesellschaften in Deutschland

Abstract In an international comparison, Germany is a high-tax country. At around 30 %, the nominal tax burden for German corporations is almost ten percentage points above the EU average. Some assume that corporations‘ actual tax burdens are significantly reduced due to tax planning and profit shifting. However, this article shows, based on information from corporation and trade tax statistics, the real tax burden can be five to twelve percentage points higher than the nominal burden due to incomplete loss offsetting, the limited deduction of financing expenses and the (partial) taxation of corporate dividends.

The behavior heuristics responsible for formation and liquidation of tax holding accounts

This article proposes the tax liquidation hypothesis, a predictable pattern of behavior regarding individuals’ decisions to create and subsequently to liquidate “Cash Holding” accounts when facing tax liabilities. Previous research on tax related trading has focused on minimizing the individual tax burden by holding winners and selling losers. This behavior, described as “optimal tax trading” suggests that individuals should sell stocks that have lost value in the short-term while holding onto stocks that have gained value until the stocks can be sold at the preferential long-term capital gains rate. This article proposes the tax liquidation hypothesis based on investor behavioral biases and the current tax environment. Individual investors will hold “cash” accounts that are consistent with their preferences for risk and return. The cash account holdings may differ across individuals, but the pattern and hypotheses regarding formation and liquidation of these accounts for tax reasons should be consistent with the model proposed by this article.

THE RESPONSE OF CROSS-BORDER E-COMMERCE MERCHANTS TO DE MINIMIS THRESHOLDS IN INDONESIA

In four years, Indonesia has changed the de minimis threshold twice. This study aims to describe on how merchants react to tax regulations, especially international trade taxes, when conducting cross-border e-commerce transactions. By using administrative data on imported documents for shipments for the period 2017-2020, which includes the application period of the three de minimis thresholds of USD 100, USD 75 and USD 3, this study found that in each application period of the De -Minimis a bunching behavior gave threshold for exemption from import duties and taxes related to imports. This study also finds a similar phenomenon at the threshold of low-value shipments around the $1,500 value, where merchants are bunching to use simplified declarations and flat-rate pricing with faster procedures and lower costs.

Revisiting resources extraction perspective in determining the tourism industry: Globalisation and human capital for next-11 economies

Natural resources and tourism sectors are vital to the growth of many nations and provide several benefits to host towns and nations. Consequently, economic revenue increases, thousands of jobs are created, a country's infrastructure is improved, and cultural participation between foreigners and locals is nurtured. This study examines the influence of economic growth (GDP), Human Capital Index (HCI), Globalization (KOFG), Political Risk (PRI) and Natural resource rent (TNRNTS) on the number of international tourists' arrival (TRSM) in Next-11 economies for 1990–2020. The panel is checked for various diagnostic checks followed by Westerlund panel cointegration test and method of moment quantile regression. The outcomes reveal that GDP, HCI, and KOFG significantly boost tourism, whereas higher political risk discourages international tourists' arrivals in Next-11 economies. Moreover, the panel causality test findings report a two-way causal association between GDP and TRSM, HCI and TRSM, KOFG and TRSM, PRI and TRSM. Any policy change in GDP, HCI, KOFG and PRI will imply Tourism sector of Next-11 economies. According to the empirical results of this work, it is proposed that these nations should further improve their participation in global trade activities through less stringent trade tax and enhance their political system to minimize the risk and activate the tourism industry.

Energy productivity and environmental degradation in the Netherlands: evidence from the novel Fourier-based estimators.

Due to the incessant quest for economic growth, global energy demand has increased to a level that requires urgent rethinking. The Netherlands depends heavily on traditional energy sources, which are finite and equally emit a lot of greenhouse gasses, causing further environmental destruction. To sustain economic growth and protect the ecosystem, it is crucial for the Netherlands to consume energy efficiently. Given that policy directions are required, this paper investigates the effect of energy productivity on environmental degradation in the Netherlands between 1990Q1 and 2019Q4, using the Fourier ARDL (autoregressive distributed lag) and Fourier Toda-Yamamoto causality approaches. The Fourier ADL estimates indicate that all variables are cointegrated. Additionally, the long-run Fourier ARDL estimates indicate that investments in energy productivity could help reduce carbon dioxide emissions in the Netherlands. Furthermore, the Fourier Toda-Yamamoto causality outcomes suggest that energy productivity, economic growth, and renewable energy consumption have a unidirectional causal effect on CO2 emissions. These revealing outcomes provide significant policy insights for the Netherlands' energy productivity objectives in their new energy policy proposed in 2022. The government could, through the new energy policy, increase investment in smart meters and review existing fossil fuel subsidies and energy trade taxes. Additionally, the government could consider reviewing the Netherlands' economic structure by increasing the share of the primary and tertiary sectors to the rising economic growth to reduce energy consumption.

Trade tax risks in the operation of medical, dentistry, and group practices

Trade tax risks in the operation of medical, dentistry, and group practices

Effect of the Shadow Economy on Tax Reform in Developing Countries

The present analysis has examined the effect of the shadow economy on tax reform in developing countries. The first type of tax reform is the “structural tax reform” (STR) characterized by large episodes of tax revenue mobilization, identified by Akitoby et al. (2020) [Tax revenue mobilization episodes in developing countries, Policy Design and Practice 3: 1–29] using the narrative approach that allows obtaining the precise nature and exact timing of major tax actions in several areas of tax policy and revenue administration that truly led to increases in tax revenue. The second type of tax reform is referred to as “tax transition reform” (TTR) and reflects the reform of the tax revenue structure that involves the reduction of its dependence on international trade tax revenue at the benefit of domestic tax revenue. The analysis has used various estimators and shown that the shadow economy reduces the likelihood of STR (notably in low-income countries), including in several tax policy areas and in the revenue administration area. The shadow economy also undermines the TTR process in countries whose tax revenue structure is strongly dependent on international trade tax revenue. Finally, it fosters the TTR process in countries that enjoy greater trade openness.

Analyzing the Effects of Governmental Policy and Solar Power on Facilitating Carbon Neutralization in the Context of Energy Transition: A Four-Party Evolutionary Game Study

For achieving carbon neutralization and promoting the coordinated development of solar and coal-fired power generations in the context of energy transition, this paper develops a public–private partnership project including the government, carbon exchange enterprise, solar thermal power plant and a coal-fired thermal power plant. Using the four-party evolutionary game theory method, the evolutionary stable strategies are evaluated. The influence estimate results of key factors show that a higher carbon emission penalty and a green electricity subsidy as well as a lower carbon trading tax rate will be beneficial to the carbon trading market, as well as facilitate carbon neutralization. In most instances, the government and carbon exchange enterprise can hold acceptable participating intention. For relatively suitable reference value ranges, the carbon emission quota sale price range of the solar thermal power plant sold to the carbon exchange enterprise is 5.5~6.0 USD/t, that of the carbon exchange enterprise sold to the coal-fired thermal power plant is 5.0~6.5 USD/t, that of the solar thermal power plant sold to the coal-fired thermal power plant is 5.0~5.5 USD/t, that sold to the coal-fired thermal power plant by outside organizations is 9.0~10.5 USD/t, and the carbon trading tax rate range is 6.0~6.2%.