The Role of the Tax System

Nowadays, many multinationals use tax avoidance strategies in order to minimise their tax liability. They often cooperate with governments providing them preferential treatment. These low-tax jurisdictions called tax havens pose a threat for world economy because they result in huge budgetary loss for countries. Even the European Union has its own tax havens which contribute to the loss of 250 billion euros annually. It is more than 2% of the Union’s GNP. Despite the apparent negative evidences, several member states’ tax system still contains favourable provisions for multinationals. Although, almost everybody would mention the Benelux states first, but many multinationals utilize the loopholes of the Irish tax system. In this regard, it is enough to refer to the Apple case where the European Commission ordered the recuperation of 13 billion euros from the company due to illegal state aid. Hence, we conducted a research based on academic literature and case-law. After a short introduction and dealing with the European Commission’s response to tax avoidance, we analyse the Irish tax system. The main goal was to demonstrate that Ireland – despite the denial of the respective authorities – was a tax haven. Our study proves that multinationals could use almost freely several tax optimisation strategies (e.g. Double Irish and Dutch Sandwich) up to now. Due to strong criticism and scandals the government had to amend the former tax regime, but it does not mean that preferential treatment is abolished. Ireland still should be considered a tax haven.

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The role of tax potential in stimulating the effectiveness of innovation in the digital economy

E3S Web of Conferences ◽

10.1051/e3sconf/202127410003 ◽

2021 ◽

Vol 274 ◽

pp. 10003

Author(s):

Olga Maksimchuk ◽

Elena Maznitsa ◽

Larisa Chizho

Keyword(s):

Digital Technologies ◽

Main Tool ◽

Digital Economy ◽

Tax System ◽

Advantages And Disadvantages ◽

The Subject ◽

The Russian Federation ◽

New Challenges ◽

Tax Benefits

The conditions of the digital economy dictate new challenges in order to correct structural imbalances; answers to these challenges are possible in the format of innovations. Since the beginning of the pandemic, it has become even more obvious that enterprises that have actively introduced innovations, in particular digital technologies and products, have become successful players in all markets. And tax stimulation has always been the most effective tool for innovation in economic activity.The purpose of this study is to substantiate the role of tax potential in stimulating the effectiveness of innovation in the digital economy. The object of research is the tax potential of the territory. The subject of the research is tax stimulation for the efficiency of innovation in the digital economy. The article presents the advantages and disadvantages of the existing tax system for stimulating innovation in Russia, the tax benefits as the main tool for stimulating innovation in the Russian Federation, the proposals for improving legislation on taxes and fees.

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An evaluation of the current education tax system and its administrative performance

Korean Journal of Policy Studies ◽

10.52372/kjps01004 ◽

1986 ◽

Vol 1 (0) ◽

pp. 47-69

Author(s):

Shin Bok Kim

Keyword(s):

Management System ◽

Current Situation ◽

Frame Of Reference ◽

Time Limit ◽

Educational Finance ◽

Relative Role ◽

Tax System ◽

The Government ◽

Criteria For Evaluation

The education tax in Korea was adopted in 1981 with the time limit of five years but in 1986 the government extended its validity five more years. This paper tried to evaluate its desirability of the current education tx system from socio-economy viewpoints and its performance in pratice from administrative aspects. After introducing a brief summary of current situation in Korean educational finance and the relative role of the education tax, the paper developed a frame of reference composed of three categories with twelve criteria for evaluation. Based on the findings above, this paper recommended the its management system in order for the tax to perform its expected functions as an earmarking tax.

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Microeconomic Effects of Indirect Taxes

Baikal Research Journal ◽

10.17150/2411-6262.2021.12(2).3 ◽

2021 ◽

Vol 12 (2) ◽

Author(s):

Vyacheslav Bubnov ◽

Yuliya Urazumbetova

Keyword(s):

Supply And Demand ◽

Entrepreneurial Activity ◽

Tax System ◽

Economic Agents ◽

Production Distribution ◽

Indirect Taxes ◽

Entire History ◽

Micro Level

Throughout its entire history Russian tax system has been built on the prevalence of indirect taxation. In the Russian tax system such taxes account for more than 60 % and their level and amount has a significant impact on the economy. The ratio between direct and indirect taxes is one of the indicators of the quality of the tax system. Unlike direct indirect taxes increase the formed price of products (goods, works, services), the final payer of indirect taxes is the buyer. Indirect taxes have a more complex impact on economic processes through pricing, both at the macro level and at the micro level. We defined the role of indirect taxes in the regulation of processes at the micro level, namely, the functioning of economic agents in the course of their production, distribution, consumer, and exchange activities. The research found the following microeconomic effects of indirect taxes: changes in supply and demand; deformation of the behavior of economic agents; decrease in entrepreneurial activity; the emergence of an additional factor of production. The study also showed possible consequences of the increase in the rates of indirect taxes for the country's economy.

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Issues, Challenges and Problems with Tax Evasion: The Institutional Factors Approach

Gadjah Mada International Journal of Business ◽

10.22146/gamaijb.12573 ◽

2016 ◽

Vol 18 (2) ◽

pp. 187

Author(s):

Mohd Rizal Palil ◽

Marlin Marissa Malek ◽

Abdul Rahim Jaguli

Keyword(s):

Tax Evasion ◽

The Body ◽

Assessment System ◽

Institutional Factors ◽

Self Assessment ◽

Tax System ◽

Body Of Knowledge ◽

Hidden Economy ◽

Tax Education

Tax evasion, particularly in developing countries is a debatable issue. Evasion is a disease and needs to be minimized so that the black economy or hidden economy can be mitigated. This paper attempts to reveal the determinants of tax evasion from the institutional perspectives. The objective of this study is to identify the determinants of tax evasion a decade after the introduction of a Self-Assessment System (SAS). Three institutional perspectives of the determinants of tax evasion were examined, namely the probability of being detected, the role of the tax authority and the complexity of the tax system. The results suggested that the complexity of the system, and the probability of being detected had a significant impact on tax evasion. The results of this study could possibly contribute to the body of knowledge in lieu of combating tax evasion, as well as being an input to tax administrators and policymakers into which ways the determinants can affect compliance. The findings also provide an indicator for tax administrators of the relative importance of the tax system in assisting with the design of tax education programs, simplifying tax systems and developing a wider understanding of taxpayers’ behavior.

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Taxes in America

10.1093/wentk/9780190920869.001.0001 ◽

2020 ◽

Author(s):

Leonard E. Burman ◽

Joel Slemrod

Keyword(s):

Income Tax ◽

Tax Law ◽

Costs And Benefits ◽

Tax System ◽

Role Of Government ◽

The World ◽

Comprehensive Reform ◽

Jobs Act ◽

Answer Format

Arguments about taxation are among the most heated-no other topic is as influential to the role of government and the distribution of costs and benefits in America. But while understanding of our tax system is of vital importance, the complexity can create confusion. Two of America's leading authorities on taxes, Leonard E. Burman and Joel Slemrod, bring clarity in this concise explanation of how our tax system works, how it affects people and businesses, and how it might be improved. The book explores what makes a tax system fair, simple, and efficient, why our system falls short, and whether the new tax law promises much, if any, improvement. Accessibly written and organized in a clear, question-and-answer format, the book describes the intricacies of the modern tax system in an easy-to-grasp manner. It has been revised and updated to both explain the Tax Cuts and Jobs Act (TCJA) in 2017, the most comprehensive reform of its income tax system since 1986, and to examine its likely effects on individuals, businesses, and society. Among the questions discussed are: How much more tax could the IRS collect with better enforcement? How do tax burdens vary around the world? Why do corporations pay so little tax, even though they earn trillions of dollars every year? What kind of tax system is most conducive to economic growth? And, can taxes be fair?

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