scholarly journals Changes in taxation and their impact on economic growth in the European Union

2011 ◽  
Vol 59 (2) ◽  
pp. 325-332 ◽  
Author(s):  
Irena Szarowská
Keyword(s):  
Economic Growth ◽  
European Union ◽  
Income Tax ◽  
Corporate Income Tax ◽  
Gdp Growth ◽  
Panel Regression ◽  
The European Union ◽  
Gdp Growth Rate ◽  
Social Contribution ◽  
Negative Effect

The aim of the paper is to analyze changes in taxation and their impact on economic growth in the European Union. The analysis is performed on adjusted annual panel data of 24 European Union countries in a period 1995–2008. Panel regression with fixed effects is used as a basic method of research. The panel regression is based on analysis the effect of total tax quota changes on GDP growth in model 1, of changes in its components (social contribution, direct and indirect tax quotas) in model 2 and of personal and corporate income tax quota changes in model 3. Results of empirical tests verify statistically significant negative effect of tax burden on GDP growth. Total tax quota increased by 1% decreases the GDP growth rate by 0.29% in the same year. Estimations confirm a statistically significant negative effect of direct taxes on GDP growth as well. A cut in the direct tax quota by 1% raises the GDP growth rate by 0.43%. The model also presents a high negative impact of an increase in the corporate income tax quota on GDP growth (a value of the regression coefficient is minus 1.28%). The effect of social contribution quota on GDP growth is not statistically significant in any estimation.

scholarly journals Tax Loss Amortization of Companies in Slovakia

2020 ◽  
Vol 13 (10) ◽  
pp. 241
Author(s):  
Anna Bánociová ◽  
Slavomíra Ťahlová
Keyword(s):  
European Union ◽  
Income Tax ◽  
Time Horizon ◽  
Descriptive Statistics ◽  
Corporate Income Tax ◽  
The European Union ◽  
Review Of Literature ◽  
Tax Loss ◽  
The Relationship

The purpose of this article is to research how companies optimize income tax with the ambition to maintain the achieved sales and profits at the highest possible level. Its purpose is to find out whether companies in Slovakia compensate for higher tax liability by tax loss amortization to reduce their income tax payable. Based on the review of literature from the field of legislation concerning the tax loss amortization by using the descriptive statistics of selected corporate and tax indicators, the companies are monitored in order to capture their behavior in paying income tax. The methods of deduction and synthesis are used in this article. The observed corporate and tax indicators are focusing on the relationship between the tax liability arising from corporate income tax, amortized tax losses, and the amount of tax payable in Slovakia in the period from 2015 to 2018. Tax loss can be considered as a tool for tax optimization, which is used by companies in all countries of the European Union, while the scope of its applicability is often limited by a time horizon. The amortization of tax losses has an impact on the amount of tax levied and the subsequent income tax payable, while the possibility to use this tool of tax optimization is influenced by the changing legislation in the period under review.

CHARACTERISTICS OF CORPORATION TAX IN POLAND AND STATISTICAL ANALYSIS OF STATE TAX REVENUES

2018 ◽  
Vol 2 (XVIII) ◽  
pp. 215-232
Author(s):  
Tomasz Słapczyński
Keyword(s):  
European Union ◽  
Income Tax ◽  
Industrial Development ◽  
Free Market ◽  
Corporate Income Tax ◽  
Tax Rates ◽  
The European Union ◽  
Corporation Tax ◽  
Tax Management ◽  
State Income

Corporate income tax was introduced in Poland along with the establishment of a free market economy. This is a income tax that does not take into account the minimum tax-free and does not differentiate tax entities. Corporate income tax in Poland has undergone a number of important transformations, especially after the accession of Poland to the European Union. Tax rates have been systematically reduced since the early 1990s. Corporate income tax should be particularly convenient for entrepreneurs, and should not act destructively because the number of entrepreneurs in the state determines the level of economic and industrial development. This is even more important since, after Poland’s accession to the European Union, the transfer of the company to another country belonging to the community is no more a problem. The attractive income tax also attracts foreign investors for whom the aspect related to easy accounting is one of the key. The aim of the work is to bring the issue of Polish corporate income tax. It tries to address issues related to tax management in an enterprise, with the application of discounts and exemptions by entrepreneurs and also issues related to state income from corporate income tax and the income lost by the use of relief and dismissals.

scholarly journals Domestic Debt and Economic Growth in Tanzania

2018 ◽  
Vol 1 (1) ◽  
pp. p207
Author(s):  
Josephat Lotto ◽  
Catherine T. Mmari
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Gdp Growth ◽  
Gdp Growth Rate ◽  
Domestic Debt ◽  
Negative Effect ◽  
The Government ◽  
The Impact ◽  
The Relationship ◽  
Positive Effect

The main objective of this paper was to examine the impact of domestic debt on economic growth in Tanzania for the period 1990 to 2015 using Ordinary Least Square (OLS) regression method to estimate the effects. The study finds that there is an inverse but insignificant relationship between domestic debt and the economic growth of Tanzania as measured by GDP annual growth. The inverse relationship between domestic debt and GDP may be caused by different factors such as; increased trend in domestic borrowing, government lenders’ profile dominated by commercial banks and non-bank financial institutions which promotes the “crowding out” effect; the nature of the instruments used by the government ; the improper use of the domestic borrowed funds which may include funding budgetary deficits, paying up principal and matured obligations on debt, developing financial markets as well as fund other government operations. Other control variables relate with the GDP as predicted. For example, Inflation (INF) has a negative effect on the GDP growth rate, but the relationship is not statistically significant, while gross capital formation (GCF) has a positive statistically significant effect on GDP growth rate. Furthermore, foreign direct investment (FDI) showed a positive effect on the GDP growth rate and export (X) has a positive effect on GDP growth rate, and the relationship is statistically significant explaining that if a country applied an export-led growth economic strategy it enjoys the gains of participating in the world market. This means that an increase in export stimulates demand for goods which leads to increase in output, and as a country’s output increases, the economic performance also takes a similar trend. Finally, government expenditure (GE) had a negative effect on the GDP growth rate which may be explained by the increased government expenditures which are funded by either tax or borrowing. Therefore, what is required for countries like Tanzania is to have better debt management strategies as well as prudential financial management while maintaining to remain within the internationally acceptable debt level of 45% of GDP and maintain a GDP growth rate of not less than 5%. It is important for the country to realize from where to borrow from, the tenure, the risks involved and limitations to borrowing and thus set the right balance of combination of both kinds of debt. Another requirement is to properly utilize the borrowed funds. The central government’s objective should be to use the funds in more development-oriented projects that bring positive returns to the economic development.  The government should not only create a right environment and policies for investment to attract investment from domestic and foreign sources but also be cautious about the kind of investments that the foreign investors make.

scholarly journals Effective Corporate Income Tax Rates: Southern and Northern Economies of the European Union

2020 ◽  
Vol 10 (1) ◽  
pp. 117
Author(s):  
Dimitris Balios ◽  
Nikolaos Eriotis ◽  
Stefanos Tantos ◽  
Dimitrios Vasiliou
Keyword(s):  
European Union ◽  
Income Tax ◽  
Corporate Income Tax ◽  
Tax Rates ◽  
The European Union ◽  
Tax Rate ◽  
Industrial Sectors ◽  
Determining Factors ◽  
Business Profitability ◽  
Alternative Approaches

In the present study, we attempt to investigate the determinants of the effective corporate tax rate of companies of the European Union (EU) discriminating between northern and southern economies. We adopt in our analysis the period after the outbreak of the crisis in the Eurozone up today including some years before 2009 in the assessed period. Our empirical investigation is based on three alternative approaches to effective income tax rate based on accounting information. We investigate the determinants of ECITR assessing two sub-samples of firms from all the aforementioned industrial sectors for 16 member countries of Europe. The first sub-sample consists of firms from 12 member countries of "North" European Union and the second sub-sample consists of firms from 4 member countries of "South" European Union. The analysis covers the period 2004-2016. Estimation results point out that the effective corporate income tax rate is variously affected by firm-specific determining factors for both northern and southern economies. The relation between ECITR and determining factors is ascertained to be less significant (sensitive) during the pre-crisis period in comparison with the respective empirical findings after the outburst of the economic crisis in the European Union. Empirical findings indicate that effective corporate income tax rate is more vulnerable to financial leverage for southern economies in comparison to the northern economies signaling financing structure differences between the two EU-country groups. Finally, there is evidence that there is an indisputable and positive coexistence between business profitability and tax burden.

scholarly journals Unemployment and growth in advanced economies in the pre-crisis period

2013 ◽  
Vol 61 (2) ◽  
pp. 445-450 ◽  
Author(s):  
Milan Palát
Keyword(s):  
Growth Rate ◽  
European Union ◽  
Quantitative Methods ◽  
Statistical Significance ◽  
The United States ◽  
Gdp Growth ◽  
The European Union ◽  
The Real ◽  
Real Gdp ◽  
Gdp Growth Rate

The paper is aimed at assessing the relationship between the unemployment growth rate and the real GDP growth rate in three biggest advanced economic bodies of the world. In the statistical part of the paper the correlation determination of the real GDP growth rate and unemployment rate has been examined. The results of quantitative methods especially regression and correlation analysis statistically approved the correlation of chosen characteristics including the statistical significance in Japan and the United States. The situation in the European Union differs from the results of two other examined economies and the existence correlation hadn’t been proven statistically. This might be caused by a relatively specific economic development, structural and institutional changes which had occurred in the European Union during the reference period and which has had significant impacts for output and unemployment.

scholarly journals Eco-innovation and Economic Growth in the European Union

2019 ◽  
Vol 22 (2) ◽  
pp. 43-54
Author(s):  
Ana Andabaka ◽  
Martina Basarac Sertić ◽  
Martina Harc
Keyword(s):  
European Union ◽  
Sustainable Growth ◽  
Recycling Rate ◽  
Gdp Growth ◽  
The European Union ◽  
Green Technologies ◽  
Gdp Growth Rate ◽  
Quality Of Institutions ◽  
To Come

Abstract Eco-innovation, as a new concept, and green technologies are central to the Europe’s future and at the core of the European Union policies to boost competitiveness, create jobs, and generate sustainable growth for years to come. In this context, eco-innovation is a significant tool that combines decreased environmental impact with a positive socioeconomic impact. This paper highlights the prominent role of eco-innovation and investigates still scarcely explored impact assessment of GDP growth, quality of institutions, and recycling rates on the eco-innovation index in the 28 European Union member states. Specifically, the set of regression analyses that use panel estimation models was undertaken and the system GMM estimator with robust standard errors was used. Econometric analysis indicates that GDP growth rate, quality of institutions, and recycling rate of municipal waste had a statistically significant and positive effect on eco-innovation in the period 2010-2016.

scholarly journals CONSUMPTION EXPENDITURE OF THE ELDERLY IN THE EUROPEAN UNION: CONVERGENCE AND IMPACT ON GDP

2021 ◽  
Vol 30 (30 (1)) ◽  
pp. 268-275
Author(s):  
Sanda Anca
Keyword(s):  
Growth Rate ◽  
European Union ◽  
Gdp Growth ◽  
Ageing Population ◽  
Age Group ◽  
Consumption Expenditure ◽  
The European Union ◽  
Gdp Growth Rate ◽  
Convergence Process ◽  
The Impact

In the context of an ageing population, the aim of this study is to analyze how the consumption expenditure of the age group 50 plus affected the GDP growth rate during the period 2005-2019, at the level of the European Union countries. Using spatial econometrics, we study the convergence process of both the consumption expenditure of the 50 plus age group and the GDP. Furthermore, we analyze the relationship between the two variables and its evolution in time. We conclude that there is a bidirectional relationship between the studied variables: an increase in the growth rate of the 50 plus age consumption significantly and positively impacts the GDP growth rate and vice versa. At the level of Western European states where the share of 50 plus population is the highest, the impact on GDP growth rate is stronger. The results are relevant for further identifying possible economic opportunities created by the ageing population while supporting the European Union cohesion policy through the convergence process aimed at reaching an overall harmonious development within the member states and regions.

scholarly journals Shift in tax burden and its impact on economic growth in the European Union

2013 ◽  
Vol 61 (4) ◽  
pp. 1153-1160 ◽  
Author(s):  
Irena Szarowská
Keyword(s):  
Economic Growth ◽  
European Union ◽  
Gdp Growth ◽  
Annual Data ◽  
Tax Burden ◽  
The European Union ◽  
Causality Test ◽  
Tax Rate ◽  
Eu Member States ◽  
The Eu

This article deals with a tax burden in the European Union in as financial and economic crisis has impacted also on tax systems in the European Union. Governments’ tax measure aims to consolidate public finance and promote an economic growth. The article provides empirical evidence on a shift in a tax burden and its structure and analyzes the effects of shift in tax burden on economic growth in the EU. It is used the Eurostat definition to categorize tax burden by economic functions and implicit rates of consumption, labour and capital are investigated. The analysis is based on annual data of the EU member states in a period 1995–2010. On average, labour taxes have decreased by 1.9 p.p., capital taxes have also decreased – by 2.1 p.p., but consumption taxes have mildly increased by 0.4 p.p. in the European Union in a period 1995–2010. Pairwise Granger Causality Test was used for examining relations between economic growth and tax burden by economic functions in short-term. Results confirm that there is two-way causality between change of implicit tax rate of consumption and GDP growth; and also GDP growth Granger-causes change of implicit tax rate of capital and implicit tax rate of labour through one-way causality.

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