The level and composition of tax revenue in developing countries: Evidence from unbalanced panel data

Mahdavi, Saeid

doi:10.1016/j.iref.2008.01.001

Cited by 117 publications

(135 citation statements)

References 9 publications

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“…In Ethiopia's tax system is progressive as clearly stated on tax proclamation number 286/2002 which means a person who get high income will pay high tax under different tax schedules like personal income tax, rental income tax, business income tax and other incomes so theoretically an increase in per capita income will leads to high tax revenue. The finding is also in consistent with priori findings as Mahdavi (2008), and (Karagoz, 2013).…”

Section: Share Of Industry Sector To Gdpsupporting

confidence: 93%

“…For instance, Eltony (2002) found foreign aid and foreign debt to have positive influence on tax revenue, whereas; Gupta (2007) indicated that both have negative effect on tax revenue. As far as the relation between tax revenue inflation rates is concerned, Mahdavi (2008) indicated that tax revenue is negatively affected by inflation. Tesfaye (2015) forwarded that, foreign direct investment to GDP percentage negative significant influence on tax revenue, but Belay (2015) in his study reveals that foreign direct investment has significant positive relationship with tax revenue.…”

Section: Statement Of the Problemmentioning

confidence: 99%

“…On the other hand, countries that put greater emphasis on tax income, profits and capital gains, perform better. Mahdavi (2008) used the advanced estimation techniques with an unbalanced panel data for 43 developing countries for the periods 1973-2002. The results showed that while agriculture sector share has positive effect, aid and non-tax revenue have negative effect on tax revenue.…”

Section: Empirical Literaturesmentioning

confidence: 99%

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Determinants of Tax Revenue in Ethiopia

Gobachew¹

2017

ECO

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Abstract:Fiscal deficit is the core issue of most of the developing countries over the past several decades. The reason behind the large increase in fiscal imbalance is the rapid expansion in expenditure and low revenue collection. Hence, efficient tax system is crucial for these countries. Since Ethiopian is one among developing countries, pattern of tax revenues and economic growth across country has become a significant concern. Due to aforementioned deficiencies, Ethiopia struggles with budget deficits for a long time. The focus of this paper is to identify determinants of tax revenue in Ethiopia by using a secondary data and multiple variables regression model using OLS method. Quantitative research method was employed on time series data set for the years 1999/00 to 2015/16. Both descriptive statistics and econometric tools were employed to analyze and present the data collected from concerned bodies. The finding reveals that, industry sector share to GDP, per capita income and trade openness as measured by share of export and import to GDP have significant positive effect on tax revenue whereas; agriculture sector share to GDP and annual rate of inflation have significant and negative effect on tax revenue as measured by share of tax revenue to GDP.

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Section: Share Of Industry Sector To Gdpsupporting

confidence: 93%

Section: Statement Of the Problemmentioning

confidence: 99%

Section: Empirical Literaturesmentioning

confidence: 99%

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Determinants of Tax Revenue in Ethiopia

Gobachew¹

2017

ECO

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“…In a similar fashion, Ross (2004) for 115 countries with an observation period from 1971 to 97 does not produce any significant association between tax ratio and regime. In contrast, Garcia / von Haldenwang (2011) find a Ushaped relation between political regimes and tax ratio, with full autocracies and full democracies collecting significantly higher shares than political regimes located in-between both margins.• Fiscal contractualism emphasizes the importance of legitimacy and credibility in bargaining processes and tax compliance (Moore 2008;Fauvelle-Aymar 1999;Timmons 2005;Levi / Sacks 2007;Bates / Lien 1985;Mahdavi 2008). In this context, democracy should lead to higher tax collection, as tax payers can be more confident that taxes are spent for the common good, that the distribution of the tax burden is fair and that the risk of radical policy changes in the future is low.…”

mentioning

confidence: 98%

Assessing the tax systems' risk and efficiency in Russian regions at different levels of the budget system

Малкина¹,

Balakin²

2017

RETP

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− For the whole sample of lower-income countries, ER pressure has a significant negative effect on trade and income tax. In contrast, its effect is negative yet not significant on indirect taxes (goods and services tax), and practically zero on non-tax revenue. The effect is particularly strong and significant in non-democratic as well as in non-resource-rich countries. Apparently, these groups experience more difficulties in counteracting the impact of ER pressure shocks. − Terms-of-trade shocks have significant negative effects on non-tax revenue. The reason is perhaps that these shocks are likely to reduce profits of public enterprises that act as commodity exporters. The effect is negative and significant for all sub-groups except democracies, but stronger for non-resource-rich compared to resource-rich countries. Terms-of-trade shocks also affect income tax revenue in non-democratic and non-resource-rich countries. − Natural disaster intensity affects mostly trade and income taxes, although the coefficient is not significant in any specification.All in all it can be inferred that non-democratic and non-resource-rich countries are particularly vulnerable to shocks affecting income taxes and non-tax revenue. In the case of resource-rich countries, no clear patterns emerge: their revenue structure, though more volatile than that of non-resource-rich countries due to a higher dependence on non-tax revenue, could be less vulnerable to external shocks. At least, there is no robust evidence pointing to volatility of revenue from natural resources being directly connected to increased vulnerability vis-à-vis shocks analysed in this report. This finding Study on the vulnerability and resilience factors of tax revenues in developing countriesFinal Report AETS Consortium -November 2013 4is somewhat unexpected, as conventional wisdom and the literature on rent incomes from (principally) oil would suggest resource-rich economies to be particularly vulnerable to global price and capital shocks. From the present study we get the impression that it is much more the non-resource-rich countries we should be worried about.The findings indicate that vulnerability to shocks should not be regarded exclusively as an issue of major adverse events hitting an economy. It may be important for governments, donors and international organisations to prepare for such events and to develop the appropriate financial tools to deal with them. But it is also important to keep in mind that minor events also have significant effects on revenue and that long-term structural reforms (in particular regarding income tax and non-tax revenue) are a necessary ingredient of any strategy targeting vulnerability of revenue in developing countries. In this context, a broad tax portfolio could contribute to making total revenue less susceptible to individual shocks. Further, the better performance of democracies suggests that reforms pointing to accountability, transparency and rule of law could have an important positive effect on revenue resilience, as g...

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“…Однако, являясь источником наполнения бюджетов, торговый сбор является дополнительной налоговой нагрузкой для сектора торговли, что может негативно повлиять на ситуацию, сложившуюся в настоящее время в данной области -многочисленные публикации зарубежных исследователей по теме исследования также подтверждают это (Aarle, Garretsen, 2003;Agbeyegbe, Stotsky, WoldeMariam, 2006;Akanbi, 2013;Baunsgaard, Keen, 2010;Bouakez, Chihi, Normandin, 2014;Brückner, 2012;Cerqueti, Coppier, 2009;Cimadomo, Bénassy-Quéré, 2012;Fricke, Süssmuth, 2014;Hisali, 2012;Ihlanfeldt, Willardsen, 2014;Kameda, 2014;Konan, Maskus, 2000;Mahdavi, 2008). Поэтому властям необходимо отнестись к введению торгового сбора осторожно, учитывая все «за» и «против».…”

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The effect of the sales tax introduction on the business climate in the Russian retail trade sector

Шинкарёва¹,

Майорова²

2015

Ross. Pred.

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The level and composition of tax revenue in developing countries: Evidence from unbalanced panel data

Cited by 117 publications

References 9 publications

Determinants of Tax Revenue in Ethiopia

Determinants of Tax Revenue in Ethiopia

Assessing the tax systems' risk and efficiency in Russian regions at different levels of the budget system

The effect of the sales tax introduction on the business climate in the Russian retail trade sector

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