scholarly journals Assessment of the international competitiveness of the corporate income tax of Ukraine

2021 ◽  
Vol 2021 (1) ◽  
pp. 145-159
Author(s):  
Natalia Frolova ◽  
◽  
Keyword(s):  
Income Tax ◽  
Methodological Approach ◽  
Weighted Average ◽  
International Competitiveness ◽  
Oecd Countries ◽  
Corporate Income Tax ◽  
Tax Rate ◽  
Corporate Income Taxation ◽  
Accelerated Depreciation ◽  
International Ranking

The article is devoted to assessing the international competitiveness of the corporate income tax system based on the approach of the US Tax Foundation, which develops International Tax Competitiveness Index of the corporate income tax (ICI) and takes into account the level of income tax rates, cost recovery, tax incentives and complexity of tax law. According to the analysis of the international ranking of OECD countries, Estonia, Latvia, Lithuania, and Hungary had the highest ICIs in 2019-2020. The main factors that have had a positive effect on their competitiveness are the low top marginal income tax rate, unlimited loss carryback and carryforward, no restrictions on the list of assets subject to depreciation, as well as the use of accelerated depreciation, which allows companies to compensate for a larger share of the initial value of assets, LIFO inventory or at least inventory by the weighted average cost method, no Patent Box; no tax credit for R&D, and low corporate income tax complexity. The calculation of the ICI for Ukraine, based on the approbation of the methodological approach of the Tax Foundation, found that in 2019-2020 Ukraine with a total score of 55.07 took 24th place out of 35 OECD countries. The author characterizes the main components of Ukrainian corporate income taxation in terms of their impact on international competitiveness; in addition, ways to increase ICI are substantiated.

scholarly journals Assessment of the international competitiveness of the corporate profit tax in Ukraine

2021 ◽  
Vol 2021 (1) ◽  
pp. 116-127
Author(s):  
Nataliia Frolova ◽  
◽  
Keyword(s):  
Methodological Approach ◽  
Weighted Average ◽  
International Competitiveness ◽  
Oecd Countries ◽  
Tax Rates ◽  
Tax Rate ◽  
Corporate Profit ◽  
Accelerated Depreciation ◽  
International Ranking ◽  
Main Components

The article is devoted to assessing the international competitiveness of the corporate profit tax system based on the approach of the US Tax Foundation, which develops International Tax Competitiveness Index of the corporate profit tax (ICI) and takes into account the level of profit tax rates, cost recovery, tax incentives and complexity of tax law. According to the analysis of the international ranking of OECD countries, Estonia, Latvia, Lithuania, and Hungary had the highest ICIs in 2019-2020. The main factors that have had a positive effect on their competitiveness are the low top marginal income tax rate, unlimited loss carryback and carryforward, no restrictions on the list of assets subject to depreciation, as well as the use of accelerated depreciation, which allows companies to compensate for a larger share of the initial value of assets, LIFO inventory or at least inventory by the weighted average cost method, no Patent Box; no tax credit for R&D, and low corporate profit tax complexity. The calculation of the ICI for Ukraine, based on the approbation of the methodological approach of the Tax Foundation, found that in 2019-2020 Ukraine with a total score of 55.07 took 24th place out of 35 OECD countries. The author characterizes the main components of Ukrainian corporate profit taxation in terms of their impact on international competitiveness; in addition, ways to increase ICI are substantiated.

scholarly journals CURRENT STATE OF CORPORATE INCOME TAXATION SYSTEM IN UKRAINE

2021 ◽  
Author(s):  
Bohdan Zasadnyi ◽  
Iryna Kononohova
Keyword(s):  
Income Tax ◽  
Income Taxation ◽  
Corporate Income Tax ◽  
Entrepreneurial Activity ◽  
Social Production ◽  
State Budget ◽  
Corporate Income Taxation ◽  
Tax Legislation ◽  
Accelerated Depreciation ◽  
Taxation System

Taxes are used as a way of government influence on social production, its dynamics and structure, and are also a source of government revenue. To the greatest extent, this applies to corporate income tax, since it is one of the most important sources of budget revenue. Difficult political and economic conditions, instability and complexity of domestic legislation, a significant tax burden on business highlight the need to study the peculiarities of corporate income taxation not only as a powerful fiscal tool, but also in terms of its regulatory functions. In Ukraine, the possibilities of using corporate income tax as a regulatory factor are somewhat limited by its large budgetary value, so there is a need to study also a foreign experience of corporate income taxation in order to find the best ways for our country to improve the collection and administration of corporate income tax. To stimulate entrepreneurial activity, ensuring its stable development, it is necessary to create an optimal effective tax system that would provide stable revenues to the state budget, without burdening entrepreneurs. This issue is extremely acute, because the corporate income tax can be used as an effective tool for balanced dynamic economic growth on the basis of innovative development, and as a reliable source of state budget revenues. This article defines theoretical questions concerning the economic essence and place of the corporate profit tax in the taxation system. Determined main reasons for the fluctuations of revenues from corporate income tax in the budget of Ukraine, namely: the loss of income tax of the dominant fiscal role in the formation of tax revenues of Ukraine is due to lower rates and changes in the procedure for determining the object of taxation, as well as general negative trends in economic development of Ukraine. The main areas of improvement of corporate income taxation mechanism in Ukraine at the present stage of economy development are investigated. Conclusions are drawn about introducing a progressive system of corporate income taxation, harmonization of accounting and tax legislation on the calculation of corporate income tax, reviewing the list of tax incentives and using the accelerated depreciation method that reduces the tax base.

Taxation in a mixed economy: the case of China

2017 ◽  
Vol 34 (1) ◽  
pp. 49-61 ◽  
Author(s):  
Davidson Sinclair ◽  
Larry Li
Keyword(s):  
Income Tax ◽  
Central Government ◽  
Corporate Income Tax ◽  
Tax Rates ◽  
Government Ownership ◽  
Effective Tax Rate ◽  
Effective Tax Rates ◽  
Content Type ◽  
Tax Rate ◽  
For Profit

Purpose The purpose of this paper is to investigate how Chinese firms’ ownership structure is related to their effective tax rate. The People’s Republic of China provides an interesting environment to examine the corporate income tax. Government has significant ownership stakes in the for-profit economy and state-owned enterprises (SOEs) are liable to the corporate income tax. This is very different to most other economies where SOE tends to dominate the not-for-profit economy and pays no corporate income tax. Government ownership also varies between the central government and local government in addition to state asset management bureaus. This provides a rich institutional background to examining the corporate income tax. Design/methodology/approach A panel data analysis approach is used to examine relationship between ownership structure and effective tax rates of all public firms in China from 1999 to 2009. Findings The authors report that effective tax rates do appear to vary across the ownership types, but that SOEs pay a statistically higher effective tax rate than to non-state-owned. In addition, local government owned SOE pay higher effective tax rates than central government and SAMB owned SOE. The authors also investigate Zimmerman’s (1983) political cost hypothesis. Unfortunately, these results are econometrically fragile with the statistical significance of those results varying by empirical technique. Originality/value This paper provides insight into government ownership and taxation in China.

scholarly journals Beneficial ownership of income as an antiabusive measure in Serbian Tax Law

2020 ◽  
Vol 59 (88) ◽  
pp. 217-232
Author(s):  
Miloš Vasović
Keyword(s):  
Income Tax ◽  
Corporate Income Tax ◽  
Tax Law ◽  
Tax Rates ◽  
Double Taxation ◽  
Current Function ◽  
Tax Rate ◽  
Treaty Shopping ◽  
Beneficial Ownership ◽  
The One

The Serbian Corporate Income Tax Act contains a provision on the beneficial ownership of income (hereinafter: the BO provision), which is one of the conditions for the application of the preferential tax rate on income tax after tax deduction, which is envisaged in Treaties for the avoidance of Double Taxation on income and capital (hereinafter: Double Taxation Treaties/ DTTs). The subject matter of research in this paper is the term "beneficial ownership", which is not defined in the Corportate Income Tax Act. It may ultimately lead to abusing the preferential tax rates from the DTTs in tax planning and "treaty shopping" through the use of conduit companies. Tax experts have different opinions on the legal nature of the BO provision, which is given the function of an anti-abusive measure (on the one hand) and a rule for the attribution of income (on the other hand). The author analyzes the current function of the BO provision envisaged in the Serbian Serbian Corporate Income Tax Act (CITA), and its inadequate application. The author advocates for enacting the BO provision as an anti-abusive measure, and examines the possible application of the BO provision in domestic tax law, with reference to Articles 10, 11, and 12 of the DTTs that Serbia contracted with other states, as well as Articles 10-12 of the OECD Model-Convention on Income and Capital (2017) and Commentaries on these articles. Such an application of the BO provision may preclude "treaty shopping". In final remarks, the author points out why the BO provision should be envisaged as an anti-abusive measure in Serbian tax law.

scholarly journals Analisis Perhitungan Pajak Penghasilan Badan Pada Perusahaan Jasa Konstruksi

2018 ◽  
Vol 6 (3) ◽  
pp. 205-216
Author(s):  
Jeanne Laura Elizabeth Manuputty ◽  
Sudradjat Sudradjat
Keyword(s):  
Qualitative Research ◽  
Income Tax ◽  
Financial Statement ◽  
Corporate Income Tax ◽  
Tax Rate ◽  
Fixed Assets ◽  
Reporting Mechanism ◽  
And Behavior ◽  
Descriptive Writing ◽  
Construction Services

This research was conducted at PT. Anugerah Abba Prakarsa at Jalan Pangeran Jayakarta 45 No. A5 Jakarta Barat DKI Jakarta. The purpose of this study is to know compliance calculation of corporate income tax on construction services at PT. Anugerah Abba Prakarsa with Peratura Pemerintah no. 51 year 2008 Jo Peraturan Pemerintah no. 40 year 2009 and know how reporting mechanism of annual income tax return of construction service company at PT. Anugerah Abba Prakarsa. This research is a qualitative research with descriptive approach. Research that produces descriptive data in the form of written or oral words of people and behavior that can be observed. In other words, this research is called qualitative research because it is a study that does not hold calculations. The analytical method used is comparative descriptive writing that compares the similarities and differences between two or more facts and properties of the object under study based on a particular frame of mind. The results showed that the analysis and calculation of income tax of PT. Anugerah Abba Prakarsa has been in accordance with Peraturan Pemerintah no. 51 year 2008 JO Peraturan Pemerintah no. 40 years 2009. However, there are some time PT. Abba Prakrsa's prize suffered a constraint which resulted in the increase of the Corporate Income Tax rate to 4% from the Tax Basis.   Keywords : PSAK 16, fixed assets, financial statement

scholarly journals Management Of Accrual Components In Response To Corporate Income Tax Rate Changes: Evidence From Korea

2013 ◽  
Vol 29 (5) ◽  
pp. 1421 ◽  
Author(s):  
Won-Wook Choi ◽  
Hyun-Ah Lee
Keyword(s):  
Financial Reporting ◽  
Income Tax ◽  
Tax Avoidance ◽  
Corporate Income Tax ◽  
Tax Rate ◽  
Taxable Income ◽  
Accruals Management ◽  
Accrual Management ◽  
Aggressive Tax Avoidance ◽  
Statutory Tax Rate

Changes in the statutory corporate income tax rate provide firms with an opportunity to reduce their tax burden by shifting their taxable income from higher to lower tax rate years. One negative consequence of shifting taxable income across years is higher variation in book income for financial reporting purposes. Taxable income and book income are closely related in most countries, and, in general, reporting volatile book income across years is not a favorable signal to investors. This study investigates how firms shift taxable income and concurrently mitigate book income fluctuation by managing accrual components separately when the statutory income tax rate changes. Unlike prior studies, we decompose discretionary accruals into two components and examine distinctive patterns of accrual management in Korea, where book-tax conformity is high and aggressive tax avoidance is restricted. We find that firms manage book-tax accruals for taxable income shifting and manage book-only accruals to mitigate book income fluctuation. Furthermore, we find the extent of book-tax and book-only accruals management varies depending on the firms tax and financial reporting costs. The results of this study provide clear and compelling evidence of firms opportunistic accrual management behavior in response to statutory tax rate reduction.

THE COMPARISON OF CORPORATE INCOME TAX IN LATVIA AND LITHUANIA

2017 ◽  
pp. 20
Author(s):  
Jūlija Ščeglova ◽  
Iveta Mietule
Keyword(s):  
Income Tax ◽  
The State ◽  
Corporate Income Tax ◽  
Tax Rates ◽  
State Budget ◽  
Tax Base ◽  
Tax Rate ◽  
Common Features ◽  
Advance Payment ◽  
Tax Payers

Corporate income tax is one of the important taxes that provide revenues to the state budget. Article contains a comparison between Latvian and Lithuanian existing legislation relating to corporate income tax, studied differences between the tax rates, tax base, tax period and taxpayers. Were described differences that are related to the advance payment calculation, as well as created an example that shows how advance payments are calculated in Latvian and Lithuanian companies. As a result, it was found that there are several common features in the Latvian and Lithuanian legislation, with regard to corporate income tax, for example, the tax payers, taxation period, tax rate, the taxable amount. But there are several differences, such as the nuances of rates for non-residents, depending on the type of revenue, advance payment deadlines and other particularities of the calculation of the advance payments. Also differ corporate income tax payment deadlines. It was concluded that making advance payments in Lithuanian enterprises is more profitable, because it was calculated that at the same conditions, the amount of advances in Lithuania is lower than in Latvia.

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