Estimating the Impacts of Non-Tariff Measures in the Indian Ocean Rim Association

In recent years, the Indian Ocean Rim Association has witnessed an increasing trend in the use of non-tariff measures (NTMs). This study evaluated the impact of NTMs in the Indian Ocean Rim Association through estimations of their ad valorem equivalents at the HS chapter and country levels. A gravity model using NTM count data (intensity) was specified and estimated to derive the importer-specific ad valorem equivalents for the four (4) most used NTMs in the region. The results showed the presence of both import-impeding and import-promoting effects of NTMs; however, the import-impeding effects dominated in the region. The quantitative restriction and safeguard measures were more restrictive compared to the sanitary and phytosanitary measures and technical barriers to trade. This was expected since quantitative restrictions are trade-distorting by design. This calls for reforming trade policy in the region toward NTMs that are more transparent and trade enhancing for successful subsequent trade negotiations in the Indian Ocean Rim Association, which would support the sustainable economic development of the region.

Per-unit versus ad-valorem royalty licensing in a Stackelberg market

We consider licensing of a non-drastic innovation by a licensor that interacts with a potential licensee in a Stackelberg duopoly, comparing per-unit and ad-valorem royalty two-part contracts and showing why and when each licensing deal should be used. We contribute three findings to the literature. First, ad-valorem royalty is preferred when the licensor plays as leader in the marketplace, but per-unit royalty is preferred when the licensor plays as follower. Second, only innovations that do not hurt consumers are socially beneficial. Third, our model also suggests that both the licensor’s status as a leader or follower in the marketplace and the innovation size determine the incentive to engage in innovative activities.

Cigarette taxation and price differentials in 195 countries during 2014–2018

IntroductionRaising tobacco prices via increased taxation may be undermined by tobacco industry tactics to keep budget cigarettes on the market. Price differentials between budget and premium cigarettes allow smokers to trade down in the face of average price rises thus attenuating health benefits. This study examines global trends of price differentials and associations with taxation.MethodsEcological analysis of country-level panel data of 195 countries’ price differentials was performed and compared against total, specific excise, ad valorem and other taxation. Price differentials were expressed as the difference between budget cigarette and premium pack prices (as % of premium pack prices). Two-level linear regression models with repeated measurements (2014, 2016 and 2018) nested within each country assessed the association between country-level taxation structures and price differentials, adjusted for year, geographical region and income group.ResultsWorldwide, median price differential between budget and premium 20-cigarette packs was 49.4% (IQR 25.9%–70.0%) in 2014 and 44.4% (IQR 22.5%–69.4%) in 2018 with significant regional variation. The largest price differentials in 2018 were in Africa, with the lowest in Europe. Total taxation was negatively associated with price differentials (−1.5%, 95% CI −2.5% to −0.4% per +10% total taxation) as was specific excise taxation (−2.5%, 95% CI −3.7% to −1.2% per +10% specific excise tax). We found no statistically significant association between ad valorem taxation and price differentials.ConclusionTotal levels of taxation and specific excise taxes were associated with smaller price differentials. Implementing high specific excise taxes may reduce price differentials and improve health outcomes.

Impuestos selectivos al consumo de bebidas azucaradas en América Latina y el Caribe

Objetivo. Caracterizar el diseño de los impuestos selectivos al consumo de bebidas azucaradas en América Latina y el Caribe, y evaluar las oportunidades de aumentar su impacto en el consumo y la salud. Métodos. Se llevó a cabo una búsqueda y una evaluación exhaustivas de legislaciones vigentes a marzo del 2019, recopiladas mediante las herramientas de seguimiento ya existentes de la Organización Panamericana de la Salud y de la Organización Mundial de la Salud, fuentes secundarias, así como mediante una encuesta a ministerios de finanzas. El análisis se centró en el tipo de productos gravados y la estructura y la base de estos impuestos selectivos. Resultados. De los 33 países evaluados, en 21 se aplican impuestos selectivos al consumo de bebidas azucaradas. En siete países también se aplican impuestos selectivos sobre el agua embotellada y en al menos cuatro, se aplican tales impuestos sobre las bebidas lácteas azucaradas. Diez de estos impuestos selectivos al consumo son de tipo ad valorem con algunas bases imponibles fijadas en las primeras etapas de la cadena de valor, siete son de tipo específico y cuatro son de estructura combinada o mixta. En tres países se aplican impuestos selectivos al consumo en función de la concentración de azúcares del producto. Conclusiones. Si bien el número de países en que se aplican impuestos selectivos al consumo de bebidas azucaradas es prometedor, existe una gran heterogeneidad en su diseño en cuanto a la estructura, la base imponible y los productos gravados. Se podrían aprovechar aún más los impuestos selectivos existentes para tener un mayor impacto sobre el consumo de bebidas azucaradas y la salud si se incluyeran todas las categorías de bebidas azucaradas, excluyendo el agua embotellada, y si se recurriera más a impuestos específicos ajustados regularmente según la inflación y basados posiblemente en la concentración de azúcares del producto. Todos los países se beneficiarían si hubiera mayor orientación. Futuras investigaciones deberían tener como objetivo abordar esta brecha.

THE CONCEPT OF REAL ESTATE TAXATION BASED ON THE AD VALOREM PRINCIPLE

The purpose of this paper is to evaluate the pros and cons of ad valorem real estate taxation in the context of the reform of the Polish real estate taxation system. A property tax (or millage tax) is a levy on property that the owner is required to pay. The tax is levied by the governing authority of the jurisdiction in which the property is located; it may be paid to a national government, a federated state, a county or geographical region, or a municipality. Multiple jurisdictions may tax the same property. This contrasts with a rent and mortgage tax, which is based on a percentage of the rent or mortgage value. There are four broad types of property: land, improvements to land (immovable man-made objects, such as buildings), personal property (movable man-made objects), and intangible proper-ty. Real property (also called real estate or realty) means the combination of land and im-provements. Under a property tax system, the government requires and/or performs an appraisal of the monetary value of each property, and tax is assessed in proportion to that value. Forms of property tax used vary among countries and jurisdictions. Real proper-ty is often taxed based on its classification. Classification is the grouping of properties based on similar use. Properties in different classes are taxed at different rates. Examples of different classes of property are residential, commercial, industrial, and vacant real proper-ty. In Israel, for example, property tax rates are double for vacant apartments versus occu-pied apartments.

¿Por qué es necesario repensar la tributación minera y cómo hacerlo?

El precio del cobre sube y junto a ello volvió a la palestra también la discusión sobre el royalty minero en Chile, motivada por el proyecto de ley de 2018 que "establece en favor del Estado una compensación por la explotación de la minería del cobre y del litio" y que pasó este miércoles su primer trámite legislativo. Su objetivo es establecer un "derecho de compensación" para el Estado que le permita percibir el 3% del valor ad valorem de los minerales extraídos. Más allá de las típicas afirmaciones de acuerdo con las cuales se sostiene que esto es necesario, porque "la gran minería privada no paga lo suficiente", cabe preguntarse cuáles son los aspectos más relevantes de este debate y si existen argumentos jurídicos sólidos para instaurar un verdadero royalty, e incluso para repensar la tributación minera chilena en su conjunto. ¿Qué es un royalty y en qué se diferencia del impuesto específico a la minería?