Direct versus Indirect Taxation: Trends, Theory, and Economic Significance

Martínez-Vázquez, Jorge; Vulovic, Violeta; Liu, Yongzheng

doi:10.4337/9780857933898.00009

Cited by 58 publications

(21 citation statements)

References 77 publications

(124 reference statements)

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“…Prasad (2008) opines that indirect taxes are more attractive than direct taxes as indirect taxes symbolize an easier way by which government revenue accrue. Martinez-Vazquez, Vulovic and Liu (2011) posited that the impact of taxation on inequality depends on the size of the system of taxation; since nations with a smaller tax system has a positive impact on inequality while nations with larger size tax system have a negative impact on income inequality. Empirical evidence on direct and indirect taxation on income inequality are discussed below:…”

Section: Tax System In Nigeriamentioning

confidence: 99%

Taxation and Income Inequality in Nigeria

Anyaduba¹,

Otulugbu²

2019

AFR

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The study examined taxation and income inequality (GINI), specifically, it determined the impact of Value Added Tax (VAT), Custom and Excise Duties (CED), Petroleum Profit Tax (PPT) and Company Income Tax (CIT) on GINI in Nigeria from the year 1990 to 2016. The Cointegration and Error Correction Models (ECMs) were used to analyze the data. Augmented Dickey Fuller unit root was used to test for stationarity. Data were sourced from the Central Bank of Nigerian statistical bulletin, Federal Inland Revenue Service and the National Bureau of Statistics. The result revealed that VAT, CED and PPT had positive relationship with GINI when measured at 5% critical level, though VAT and CED were not significant. CIT had a negative but significant impact on GINI. Based on the findings, we conclude that only CIT was able to reduce income inequality. We therefore recommend that VAT should be imposed on goods and services consumed by high income earners. In respect of CED, government should address the level of tariffs; for PPT, there is need for adequate diversification of the economy; and for CIT, tax authority should harness corporate taxes to its fullness.

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Section: Tax System In Nigeriamentioning

confidence: 99%

Taxation and Income Inequality in Nigeria

Anyaduba¹,

Otulugbu²

2019

AFR

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“…Duncan and Sabirianova Peter (2008) derive a measure of income tax progressivity and ªnd that inequality in the distribution of income is signiªcantly affected by their measure of progressivity. Similarly, Martinez-Vazquez, Vulovic, and Liu (2011) ªnd that higher reliance on direct over indirect taxes improves the income distribution over time for a large number of countries.…”

Section: Regression-based Estimates Of the Impact Of Taxes On Income mentioning

confidence: 99%

Coping with Rising Inequality in Asia: How Effective Are Fiscal Policies?

Claus¹,

Martínez-Vázquez

Vulovic

2013

Asian Economic Papers

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This paper discusses the role and effectiveness of redistributive fiscal policies and provides estimates of the effects of taxation and government expenditure on income inequality in Asia. Tax systems around the world tend to be progressive, but government expenditure is generally found to be a more effective tool for redistributing income. In Asia, government spending on social protection has a distinctive differential distributive impact. Social protection spending appears to increase income inequality in Asia, whereas it reduces it in the rest of the world. Government expenditure on housing is also adversely affecting the distribution of income in Asia. Policy options for improving the redistributional effectiveness of fiscal policies in Asia are discussed.

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“…Indirect taxes such as value-added tax fall on transactions such as consumption. Martinez-Vazquez, Vulovic, and Liu (2009) show that in the last 3 decades, the average ratio of direct to indirect taxes has been rising, especially in developed countries. This is in large part due to the implementation of social security contributions.…”

Section: B Issuesmentioning

confidence: 99%

Demographic Change and Fiscal Sustainability in Asia

Lee

Kim

Park³

2016

Soc Indic Res

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on ongoing and recently completed research and policy studies undertaken by the Asian Development Bank (ADB) staff, consultants, or resource persons. The series deals with key economic and development problems, particularly those facing the Asia and Pacific region; as well as conceptual, analytical, or methodological issues relating to project/program economic analysis, and statistical data and measurement. The series aims to enhance the knowledge on Asia's development and policy challenges; strengthen analytical rigor and quality of ADB's country partnership strategies, and its subregional and country operations; and improve the quality and availability of statistical data and development indicators for monitoring development effectiveness.

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Direct versus Indirect Taxation: Trends, Theory, and Economic Significance

Cited by 58 publications

References 77 publications

Taxation and Income Inequality in Nigeria

Taxation and Income Inequality in Nigeria

Coping with Rising Inequality in Asia: How Effective Are Fiscal Policies?

Demographic Change and Fiscal Sustainability in Asia

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