Government Challenges Over Global Electronic Commerce Using FinTech

2022 ◽  
pp. 197-213
Author(s):  
Yeoul Hwangbo
Keyword(s):  
Electronic Commerce ◽  
Consumption Tax ◽  
Tax System ◽  
Consumption Taxes

The challenge over most countries has been legislating related acts and regulations on global electronic commerce taxation, but they have not implemented the consumption tax system for global electronic commerce so far. Consumer payment tax (CPT) is based on fintech and thereby proposed so that consumers can pay the consumption taxes to related taxation office of the countries in accordance with consumer country's jurisdiction principle, considering the CPT is assessed to satisfy most of the electronic commerce taxation criteria and has the potential to be applied to electronic commerce.

scholarly journals Stage 1 registered report for replication of Experiment 1 and 2 of “Axe the tax: Taxes are disliked more than equivalent costs” (Sussman & Olivola, 2011)

2018 ◽  
Author(s):  
Jerome Olsen ◽  
Christoph Kogler ◽  
Mark John Brandt ◽  
Linda Dezső ◽  
Erich Kirchler
Keyword(s):  
Value Added ◽  
Consumption Tax ◽  
Original Experiment ◽  
Tax System ◽  
Replication Studies ◽  
A Value ◽  
The Us ◽  
The Uk ◽  
Stage 1 ◽  
Consumption Taxes

Stage 1: Sussman and Olivola (2011) reported that people in the US show a stronger preference to avoid tax-related costs than to avoid tax-unrelated monetary costs of the same size and coined the term Tax Aversion to describe the phenomenon. The original Experiment 1 and 2 results indicated that people are willing to incur increased timely costs to receive a discount when it refers to taxes (e.g., “axe-the-tax discount”) than when it just refers to a regular discount (e.g., “customer rewards”). Their paper has received considerable attention and is often cited in tax behavior research when referring to citizens’ general aversion to taxes. We propose close replications of Experiments 1 and 2 in two high-powered studies in the US (N = 600 and N = 700, respectively). Because the original study was conducted in a country that relies on a sales tax system, where consumption taxes are very salient, we additionally propose conducting both replication studies in the UK to test whether the effect also applies to a value added tax system (again N = 600 and N = 700, respectively). The replication studies will test whether Tax Aversion is a stable phenomenon in the US and whether the effect extends to a consumption tax system where payments do not represent an out-of-pocket cost.

scholarly journals Consumption Taxes and Redistribution

2010 ◽  
Vol 100 (4) ◽  
pp. 1673-1694 ◽  
Author(s):  
Isabel Correia
Keyword(s):  
Simple Model ◽  
Consumption Tax ◽  
Tax System ◽  
Flat Tax ◽  
Distribution Of Wealth ◽  
Empirical Distributions ◽  
Consumption Taxes

This study considers replacing the current US tax system with only a flat tax consumption tax, showing, in contrast to the literature, that such a reform leads to a decline in inequality and increase in welfare for the welfare-poor. The results are obtained from a simple model that identifies the main channels through which the reform affects the economy. It is shown also that these novel results depend on the distribution of wealth and earnings, and that they hold for the relevant empirical distributions. (JEL D31, H23, H25)

Dynamic effects of consumption tax reforms with durable consumption

2020 ◽  
Vol 20 (2) ◽  
Author(s):  
Qian Li
Keyword(s):  
Generation Model ◽  
Consumption Tax ◽  
Income Risk ◽  
Tax Reforms ◽  
Market Completeness ◽  
Durable Consumption ◽  
Poor Households ◽  
Borrowing Constraint ◽  
The Difference ◽  
Consumption Taxes

AbstractThis paper introduces durables into a dynamic general equilibrium overlapping generation model with idiosyncratic income shocks and endogenous borrowing constraints, which depend on durables. The aim of this paper is to evaluate the welfare effects of consumption tax reforms in a richer model that captures the difference between nondurable and durable consumption. When durables are considered, the standard results that a shift to consumption taxes is welfare improving are overturned. The mechanism of this opposing result is that consumption tax makes durable consumption more expensive without relaxing the borrowing constraint. The inability of borrowing to insure against income risk deviates the economy further away from market completeness and particularly hurts young and poor households. As a result, welfare decreases, coupled with negative redistribution.

scholarly journals Welfare optimization and multinational monopolies

1996 ◽  
Vol 38 (1) ◽  
pp. 16-25
Author(s):  
A. M. Russell ◽  
C. A. Martini ◽  
J. A. Rickard
Keyword(s):  
Parameter Space ◽  
Home Country ◽  
Domestic Market ◽  
Consumption Tax ◽  
Optimal Value ◽  
National Welfare ◽  
Consumption Taxes

AbstractThis paper examines the role of import tariffs and consumption taxes when a product is supplied to a domestic market by a foreign monopoly via a subsidiary. It is assumed that there is no competition in the domestic market from internal suppliers. The home country is able to levy a profits tax on the subsidiary. The objective of our analysis is to determine the mix of tariff and consumption tax which simultaneously maximizes national welfare. We show that national welfare does not have an internal maximum, but attains its maximum on a boundary of the consumption tax–tariff parameter space. Furthermore, the optimal value of national welfare increases as the tariff decreases and the consumption tax increases. The results obtained generalize the results of an earlier paper in which national welfare was maximized with respect to either a tariff or consumption tax, but not both.

The Built-In Flexibility of Income and Consumption Taxes in OECD Countries

2017 ◽  
pp. 162-170
Author(s):  
Binhan Elif Yılmaz ◽  
Sinan Ataer
Keyword(s):  
Income Elasticity ◽  
National Income ◽  
Oecd Countries ◽  
Fiscal Policies ◽  
Tax System ◽  
Tax Revenues ◽  
Cyclical Fluctuations ◽  
Relative Change ◽  
Consumption Taxes ◽  
Automatic Stabilizers

Compatible with a variety of cyclical fluctuations in fiscal policy, is the automatic stabilising fiscal policies. There is a need to calculate the income elasticity of tax for relieving the effects of cyclical fluctuations. Income elasticity of tax, that is tax revenue have relative change, the ratio of the relative change in national income. This ratio must be bigger than 1 to label a tax system as elastic. If this ratio is bigger than 1, this situation also show the tax system has an automatic stabilizing feature. By that way, without any changes in tax structure, tax revenues increase in the deflation times and decrease in the inflation times. The automatically compensatory movement of tax revenues, generally referred to as “built-in flexibility”, has received increasing attention. The aim of this study is examining the existence of automatic stabilizers in the OECD countries by evaluating the income elasticity of income and consumption taxes and by making cross-countries comparatives.

scholarly journals Commodity Taxation under Habit Formation and Myopia

2010 ◽  
Vol 10 (1) ◽  
Author(s):  
Helmuth Cremer ◽  
Philippe De Donder ◽  
Dario Maldonado ◽  
Pierre Pestieau
Keyword(s):  
Habit Formation ◽  
Consumption Tax ◽  
Negative Externalities ◽  
Commodity Taxation ◽  
Second Best ◽  
Lump Sum ◽  
Redistributive Effects ◽  
Consumption Taxes ◽  
Second Period ◽  
Period Model

Abstract This paper analyzes the pattern of consumption taxes in a two period model with habit formation and myopia. An individual’s second-period needs increase with first period consumption. However, myopic individuals do not see this habit formation relation when they take their saving decision. The first-best solution is decentralized by a simple “Pigouvian” (paternalistic) consumption tax (along with suitable lump-sum taxes). In a second-best setting, when personalized lump-sum transfers are not available, consumption taxes may have conflicting paternalistic and redistributive effects. Taxes should discourage consumption of goods that entail negative externalities (unforeseen habits), but instead they discourage less the consumption of goods that are proportionately consumed by individuals with high net social marginal utility of income. Both myopic and farsighted individuals may benefit more from the second-best policy as the proportion of myopic agents in society increases.

THE UNEASY CASE FOR CAPITAL TAXATION

2006 ◽  
Vol 23 (2) ◽  
pp. 166-184
Author(s):  
Edward J. McCaffery
Keyword(s):  
Income Taxes ◽  
Capital Gains ◽  
Capital Taxation ◽  
Consumption Tax ◽  
Individual Level ◽  
Labor Earnings ◽  
Wage Tax ◽  
The Individual ◽  
The Right ◽  
Consumption Taxes

The traditional view of tax holds that consumption taxes fail tax the yield to capital, whereas income taxes do, leading to John Stuart Mill's criticism of the income tax as a "double tax" on wealth that is saved. A better analytic understanding illustrates that there are two types of consumption taxes. A prepaid consumption or (equivalently) wage tax indeed ignores the yield to capital. But a consistent progressive postpaid consumption tax gets at such yield, at the individual level, when but only when the returns to capital are used to elevate lifestyles in material terms. Such a tax allows "ordinary" savings that move around labor earnings, in constant dollar terms, to different periods of an individual's life, such as times of retirement or heightened medical or educational needs. Because a progressive postpaid consumption tax falls on the yield to capital at the right time-when its use at the individual level becomes manifest-all other taxes on capital, such as capital gains, gift and estate, and corporate income taxes, can and should be repealed, in the name of fairness.

scholarly journals Value-Added Tax On Virtual World Transactions: A South African Perspective

2012 ◽  
Vol 12 (1) ◽  
pp. 71
Author(s):  
Gregory Johnston ◽  
Sare Pienaar
Keyword(s):  
Electronic Commerce ◽  
South African ◽  
Virtual Worlds ◽  
Virtual World ◽  
Value Added ◽  
Consumption Tax ◽  
The South ◽  
Value Added Tax ◽  
Internet Age ◽  
African Perspective

The dawn of the internet age has brought about concepts such as electronic commerce, virtual worlds and digitized products. When consumption tax laws such as value-added tax (VAT) or goods and service tax (GST) were legislated, these concepts were not envisaged. The aim of this article is to determine whether the South African value-added tax (VAT) Act is applicable to transactions occurring in virtual worlds. The article critically analyses section 7(1) of the VAT Act to determine its applicability to transactions occurring in virtual worlds. The benefit of this article will be to highlight the deficiency in the South African VAT Act in dealing with electronic commerce transactions as well as transactions arising in virtual worlds. The study reported here concluded that the South African VAT Act in its current format does not appear to deal with transactions occurring in virtual worlds effectively. Consequently, amendments to existing law should be effected in order to deal effectively with the transactions.

Sign in / Sign up

Export Citation Format

Share Document