The Impact of Taxation Accounting of Value-Added-Tax in the Engineering of the Iraqi Economy

This study analyses the causes behind the difficulties encountered by Iraqi economy in rebuilding, provision of value added tax (VAT), formation and implementation effects in case of applying it to the Iraqi markets. In contrast to accounts that lay stress on Iraq’s statist past, we argue that the sustained decline in formal institutions and poor tax administration is the best explanation for Iraq’s economic decline. In addition to the selected micro-economic interventions, we recommend policies that more dependably and equitably distribute oil rents, such as a universal basic value added tax collection. Our recommendations thus contrast sharply with the approaches that emphasize a reduced role by the state. The aim is to facilitate the development of VAT model under conditions of lowered conflict and greater stability, a binding constraint on development for Iraqi economy. The development process for the VAT operational management in Iraqi markets. VAT operates as a transactional sales tax, often compliance in Iraqi market jurisdiction can be compromised where purchasers are a part of a scheme that operates a fraud mechanism or where supplies are made to consumers without any physical presence in destination countries. In this context, enforcement nexus must be reinforced through several mechanisms suggested in the literature.

Stakeholder Support for Wildlife Conservation Funding Policies

State wildlife management agencies in the United States have depended on a “user-pay” funding model for conservation efforts that relies on revenue from hunting license sales and a federal excise tax on firearms, ammunition, and archery equipment. Declines in hunting participation, however, jeopardize sustainability of the current funding model. Ensuring support among stakeholders for wildlife management and conservation may require expanding sources of funding and incorporating the perspectives and values of a diversifying constituency into decision making processes. We used a web-based survey of wildlife-associated recreationists in Michigan, USA to evaluate support for a range of conservation funding policies. Respondents self-identified primarily as hunters (n = 2,558) or wildlife watchers (n = 942). We used binary logistic regression to evaluate support for four conservation funding policy options: state sales tax, lottery proceeds, extractive industry revenue, and a user-based tax on outdoor gear (i.e., “backpack tax”). Determinants of support varied by type of policy and stakeholder characteristics. We found no statistically significant differences between hunters and wildlife watchers in their support for conservation funding policies when accounting for other variables such as wildlife value orientations, engagement in stewardship behaviors, age, and gender. The industry-based policy achieved the greatest level of approval, while the backpack tax had the lowest. Respondents were mixed in their support of the sales tax and lottery proceeds options. Cluster analysis revealed three homogenous groups related to conservation funding policies: “strong support,” “mixed/opposed,” and “anti-backpack tax.” Clusters differed in their support for conservation funding policies and on psychological and demographic variables. The “strong support” and “anti-backpack tax” groups differed in their levels of stewardship engagement, knowledge of conservation funding mechanisms, and support for the backpack tax option. The “mixed-opposed” group tended to be older, less educated, and less likely to be a member of a conservation organization. Results suggest support for conservation funding differs by policy type and social and psychological characteristics of stakeholders. Based on differences in policy support revealed in this study, we suggest a multi-tiered approach to funding conservation and building on support among wildlife stakeholders to mitigate the looming funding crisis for state wildlife agencies.

Research Insights: Can Salient Penalties and Enforcement on Tax Bills Increase Compliance Across Taxes?

An analytical model and a field experiment in Argentina proved that salient enforcement messages on one type of tax could increase compliance with another tax. Salient messages of penalties and enforcement for the property tax had positive spillover effects on declaration of the gross sales tax, with taxpayers in the treatment group increasing their reported tax by 2 percent. Taxpayers appear to assume that higher enforcement of one tax implies higher enforcement for others, thereby increasing their compliance across taxes.

Effects of Sales Tax Competition on Local Revenue Capacity: Empirical Analysis of California County Governments

This study empirically examines the effects of tax competition in both horizontal and vertical ways on the revenue capacity of counties in California from 2003 to 2015. Spatial Durbin model (SDM) identifies the effects of two-way tax competition on a county’s revenue capacity. The findings provide evidence that local sales tax helps a county expand its total revenue, but the two-way tax competition brings about a decrease in local revenue capacity as a result of spillovers. Furthermore, a lower-taxing area can have more benefits because the expansions in the neighbors are much greater than the higher-taxing one. In spite of the extant research of tax competition, this study adds another contribution to this research arena that the empirical approach of the SDM rules out the geospatial effects of the other explanatory variables that might have some unobserved effects in the extant literature.

An Application of the Tourist Test to Colombian Merchants

Cash is still widely used in Colombia, even among merchants that accept payment cards. Indeed, 60% of these merchants use dissuasive strategies to make their clients pay with cash. This shows that merchant service costs (MSC) for cards are not optimal in the sense of the Tourist Test. We present estimates of MSC compatible with the Tourist Test, such that merchants are indifferent between being paid with cash or cards. We find that cash is less costly than cards at the average retail-sales transaction-value, hence there is no positive optimal MSC at this ticket value. For the average card transaction ticket, the optimal MSC would be positive but far below the rates charge by the industry (0.74% in a short-term scenario). Yet, the additional incentive that sales-tax evasion provides to cash payments reduces the Tourist Test MSC to 0.44%. Our estimates for long-term scenarios yield even lower optimal MSC. An average price cap regulation that strikes a middle ground between these figures, and is complemented with sales-tax evasion measures, should discourage merchant strategies that deter consumers from paying with cards and will accommodate the wide heterogeneity in merchants´ scale, payment processing processes and ticket size. These results should be taken as a guideline as the estimations depend on the underlying assumptions and only consider the merchant´s side of the card industry.

Analysis of Tax Structure Performance and its Ratio in Indonesia

This study aims to determine and analyze fluctuations in tax revenues, tax structure, and factors that determine tax revenues and ratios in Indonesia. The data used are data on the structure, revenue, and tax ratios from 2001 to 2017. The results show that the tax structure in Indonesia was dominated by direct taxes (income tax and personal tax) with contributions >50% and progressive, while indirect tax contributions (Value-Added Tax, Sales Tax on Luxury Goods, etc.) are around 30%. The tax ratio is still low at 14.58 percent. The results also show that GDP influences tax revenue, while the value of exports and the number of taxpayers have no effect. The tax ratio in Indonesia is influenced by GDP and the value of exports, while the mandatory amount has no effect. From a sample of 150 SMEs in Jambi, it is known that the level of compliance, obedience, assessment of tax servants is considered very good (average value> 80). Taxpayers' confidence in the use of tax funds for the benefit of the state is still low at 40.27, and sanctions for non-negotiable tax violations are also low at 48.53.