Taxation has gained considerable attention in the past few year and lot of studies have be en done on tax evasion and tax compliance. This study assesses the level of tax and identifies factors that shape tax morale in Mauritius. A self-developed questionnaire was distributed to 250 randomly respondents and a logistic regression analysis was use d to analyse data collected. A high degree of tax morale is required to achieve high level of tax compliance. The result shows that socio -demographic and socio economic factors have an impact on tax morale and it can be seen that social norm, fairness and equity, trust in government and in tax authority are determinants that shape tax morale. The findings are in line with that some authors who found out that that there is a positive correlation between inequity and tax evasion. The study recommended that population should be educated, tax system should be simplified, government should be fair and tax authority should respect the population.
This study has made an attempt to investigate and analyze empirically the impact of Foreign Direct Investment (FDI) on the economic growth for a panel of 32 Sub-Saharan African countries during the period 2008-2014. Both static panel regression techniques and dynamic panel estimates were employed to assess the causal link of our regressors, namely, FDI, trade openness, domestic investment, working population size and the effects of the 2009 European debt crisis on our dependent variable, Gross Domestic Product (GDP) per capita. The evidence from the statistical analysis suggests that aggregated FDI does have a positive and significant impact on economic growth and is thus consistent with the literature, especially with respect to developing countries. Based on static random effects, the inclusion of the 2009 Euro zone crisis did not diverge the results despite its negative impact on economic growth. The contribution of FDI is observed to be relatively higher than domestic investment.
BackgroundIn response to high smoking rates, especially among men, Mauritius launched a National Action Plan on Tobacco Control in 2008. It changed its tax system from a mixed system to a uniform specific system. Despite these interventions, cigarette consumption and smoking prevalence in Mauritius decreased only marginally in the subsequent decade.MethodUsing publicly available data, we decompose the retail price of cigarettes into tax and net-of-tax components, between 2011 and 2017. We cover premium, popular and economy cigarettes.ResultsSince its introduction in 2008, the nominal excise tax was increased six times. Between 2011 and 2017, the real value of the excise tax increased by 47%. Meanwhile, British American Tobacco (BAT) increased the real net-of-tax price of premium cigarettes by 61.8% and of popular cigarettes by 47.2%, thus overshifting the tax increase. On economy cigarettes, BAT decreased the real net-of-tax price by 14.7%, thus undershifting the excise tax increase.ConclusionThrough its pricing strategy, BAT has greatly undermined Mauritius’s tobacco control policy. However, BAT cannot continue undershifting the excise tax on economy brands, since the net-of-tax proportion of the retail price is very low already. BAT would have little choice but to increase the retail price on economy brands in response to future excise tax increases. The government of Mauritius is encouraged to keep the specific excise tax structure but to increase the rate at which it is levied.
Tax is the income which is paid to the government in order to fulfill the need of the public. However tax evasion is the act of not paying the tax by use of illegal ways. Allingham and Sandmo being the first researchers studying the tax evasion found a relationship of tax evasion with low penalty fees and a low detection. The tax evasion basically is affected by various factors but it also affects many economic factors. Sub Saharan Africa being a developing region is facing the phenomenon of tax evasion in a crucial way. This study measures the impact of the tax evasion on the Gross Domestic Product (GDP) per capita of Sub Saharan Africa. The relationship between the GDP per capita and tax evasion is tested using the generalized least squared whereby it is found that there is a positive impact of tax evasion on the GDP per capita however the p-value states that the tax evasion is insignificant and is not an important component for the determination of the GDP per capita. Moreover in the presence of tax evasion, this study shows that GDP per capita has also a negative relationship with the Foreign Direct Investment (FDI), positive relationship the Gross Domestic Fixed Capital Formation (GDFCF), a favorable connection with the export, a negative relationship with the import, a positive impact on the inflation and a negative relationship with the government expenditure. To fight against tax evasion for the economic benefit of Sub Saharan Africa, it is advised to review the tax system, to implement strict and severe penalties and very high fines for tax evaders. Moreover, the tax authorities of Sub Saharan Africa need to appoint more experts in auditing department to be able to detect the non-compliance tax payers easily and rapidly
Purpose This study aims to analyze tax revenue in the presence of double tax treaties affecting social welfare of the inhabitants in the Sub-Saharan African (SSA) developing economies, whose fiscal regimes are being branded as responsible for exacerbating poverty for the inhabitants. This paper seeks to determine if double tax treaties are negatively impacting on human development of the host countries. Design/methodology/approach This study analyses 21 SSA countries from 1996 to 2016 using panel models and bootstrapped quantile regression. It uses a devised mathematical model which introduces the interaction between tax revenue and double tax treaties and measures the social welfare impact using the human development index (HDI). Findings The findings have broadly shown that (i) the net effect from the complementarity between tax revenue and double tax treaty (DTTs) in influencing the human development is for the most part negative (ii) the impact of tax revenue from international trade has the most positive net effect as compared to other tax revenues when interacted with the DTT and (iii) the DTT complements the tax revenue from income, profits and capital gains to progressively increase human development in the upper quartiles of HDI. Research limitations/implications This study has examined how the presence of double tax treaties has impacted the effect of tax revenue on human development in 21 SSA countries for the period 1996–2016. A mathematical model was devised and bootstrapped quantile regression was used owing to the specificities of the sample. In accordance with recent literature on net effects, the results were interpreted. Practical implications It is evident that further research is required on whether double tax treaties are indirectly responsible for poverty on the rise in SSA countries or on the contrary, they bring FDI alongside with other positive spillovers which in the end contribute to a rise in the human development aspect of societies in developing host economies. Social implications The HDI is an important measure used nowadays for human development as a proxy for social welfare. This research will use an HDI mathematical model devised by Sinha and Sengupta (2019) and adapt it to the context to testing econometrically whether double tax treaties have an impact on welfare or poverty reduction. The empirical results will help determine whether tax treaties are impacting the social welfare positively or negatively. Originality/value This result is the first research attempt to consider both the impact of tax revenue (which is expected to have a positive impact on social welfare of the people of the host developing countries) and the impact of double tax treaties simultaneously. It is the first empirical study focusing on the impact of tax revenue on human development in the presence of double tax treaties. Its methodology is original and adds to the current literature to benefit policymakers and academia.
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