The Determinants of Tax Revenue and Tax Effort in Developed and Developing Countries: Theory and New Evidence 1996-2015

Piancastelli, Marcelo; Thirlwáll, A. P.

doi:10.1590/0103-6351/5788

Cited by 12 publications

(15 citation statements)

References 12 publications

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“…This result is similar to column 5 of Table 5 regarding the effect of the three regressors on the tax ratio. In addition, these findings also support the results obtained by Piancastelli and Thirlwall (2020) in developed and developing countries. They found that per capita income, trade openness, and the manufacturing sector have positive and significant effects on tax effort below the 1%, 1%, and 5% significance levels, respectively.…”

Section: Estimation Results Of Tax Effort Regressionsupporting

confidence: 89%

“…According to Le et al (2008), taxable capacity is a predictive tax-to-GDP ratio calculated using the estimated coefficients of the regression specifications, taking into account country-specific characteristics. Tax effort is an index of the balance between the actual collection per GDP and taxable capacity (Piancastelli & Thirlwall, 2020). Hence, we have:…”

Section: Methodsmentioning

confidence: 99%

“…An empirical approach involving the determinants of tax collection needs to be used to implement it. Concerning this issue, Piancastelli and Thirlwall (2020) posited that the factors used to determine tax collection should focus on the revenue bases typically represented by the economic structure. The use of other variables such as institutional and political environment can reduce the measured tax effort because taxable capacity is predicted to increase.…”

Section: Literature Reviewmentioning

confidence: 99%

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Macroeconomic Determinants of Tax Revenue and Tax Effort in Southeast Asian Countries

Saptono

Mahmud²

2021

JDE

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This paper analyzes macroeconomic indicators that determine tax revenues in six Southeast Asian countries during 2008 – 2019. The estimation results are then used to predict the value of taxable capacity to construct the deal of tax effort. Using the FE model equipped with the Driscoll-Kraay standard errors, this study finds positive and significant effects of per capita income, manufacturing, and trade openness on the actual tax-to-GDP ratio and tax effort. In contrast, inflation is considered a different determinant because of its insignificant effect on the two measures of tax performance. In addition, the authors also classify countries into three other groups based on the actual level of tax revenue and the effort put into collecting taxes. The benchmarks used to rank countries are all sample countries’ median substantial tax revenue and the tax effort index 1. Regardless of the classification, several policy implications are offered to increase tax collection productivity by focusing on the revenue bases used in the estimation model. Keywords: Tax Revenue, Tax Capacity, Tax Effort, Southeast Asia, Panel DataJEL: H2, O1, O2

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Section: Estimation Results Of Tax Effort Regressionsupporting

confidence: 89%

Section: Methodsmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

See 1 more Smart Citation

Macroeconomic Determinants of Tax Revenue and Tax Effort in Southeast Asian Countries

Saptono

Mahmud²

2021

JDE

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“…For statistical reasons, cross‐country analyses of this nature usually include as many countries and observations as possible. Hence, world samples are the norm (e.g., Piancastelli & Thirlwall, 2019; Rodríguez, 2018). The policy recommendations for developing countries from such studies invariably include tax‐base broadening and a stronger focus on combatting tax evasion.…”

Section: Motivation and Empirical Literaturementioning

confidence: 99%

Domestic revenue mobilisation in developing countries: An exploratory analysis of sub‐Saharan Africa and Latin America

Gwaindepi

2021

J of Intl Development

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This study compares taxation trends, volatility and tax effort between sub-Saharan Africa (SSA) and Latin American and the Caribbean (LAC) countries since 1980. It finds that the LAC countries lead on revenue collection and revenue stability, but richer SSA countries outperform their LAC counterparts. Since 2010, there has been a divergence on personal income taxes, which have grown in SSA but declined in the LAC. The panel analysis shows that tax determinants are sensitive to income levels. The study shows the importance of exploring diversity and crossregional variations on income levels. Additionally, it shows that room exists for peer-to-peer lessons on tax reforms.

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“…In international literature, special emphasis has been given to whether or not agriculture and its share of an economy's GDP affects tax evasion and the VAT gap. Such studies include those of the CASE institute (2020), Piancastelli and Thirlwall (2020), Dalamagas, Palaios, and Tantos (2019), Motsatsi (2018), Cnossen (2018), Zidkova (2016), Godin and Hindriks (2015), Thackray και Ueda (2014), Crivelly and Gupta (2014), Betliy (2014), Ufier (2014), Botlhole, Asafu-Adjaye, and Carmignani (2012), Martinez-Vazquez and Bird (2011), Pessino and Fenochietto (2010), Keen and Lockwood (2010), Aizenman και Jinjirak (2008), Bird, Martinez-Vazquez, andTorgler (2008), Gupta (2007), Bird et al (2004) and Ebrill et al (2001). The results from each of these studies varied greatly, mainly due to the fact that the agricultural sector is hard to tax and most of the studies concern crosscountry data.…”

Section: Agriculture Forestry and Fishingmentioning

confidence: 99%

The Greek VAT Gap: The Influence of Individual Economic Sectors

Anna¹,

Eriotis²,

Ioannis³

et al. 2021

ERSJ

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The size of the Greek VAT Gap has been consistently high throughout the last two decades in comparison with the European Union's (EU) average. In order to better understand which specific productive sectors in the Greek economy play a more significant role in VAT revenue collection, VAT evasion and in measuring and limiting the Greek VAT Gap, an attempt to quantify and analyze the Gross Value Added/Gross Domestic Product (GVA/GDP) ratio of each productive sector was made. Design/Methodology/Approach: Specifically, using the NACE Revision 2 standard used by Eurostat, the various Greek productive sectors were broken down into fifteen (15) categories and examined for a period of 21 years (between 1997 and 2018) using econometric models based on time series data. In addition, the VAT Revenue Ratio (VRR) was used as a proxy dependent variable in order to measure the Greek VAT Gap. Findings: The analysis revealed that of the fifteen (15) economic sectors examined in this paper, four (4) were found to be statistically significant in regards with the Greek VAT gap. Specifically, the Catering and Accommodation services sector (I), the Public Administration sector (O) and the Agriculture sector (A), had a positive relationship, with the increase of their share in GDP being associated with an increase in the VAT gap. On the other hand, the Industrial sector's (B, D, E) share of GDP is associated with a reduction in the VAT gap. Practical Implications/Originality/Value: The results of this paper can shed light into the complexity of identifying the economic activities that influence the Greek VAT Gap, as well as produce more sector-specific countermeasures for limiting VAT non-compliance and evasion.

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The Determinants of Tax Revenue and Tax Effort in Developed and Developing Countries: Theory and New Evidence 1996-2015

Cited by 12 publications

References 12 publications

Macroeconomic Determinants of Tax Revenue and Tax Effort in Southeast Asian Countries

Macroeconomic Determinants of Tax Revenue and Tax Effort in Southeast Asian Countries

Domestic revenue mobilisation in developing countries: An exploratory analysis of sub‐Saharan Africa and Latin America

The Greek VAT Gap: The Influence of Individual Economic Sectors

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