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Wednesday, July 22, 2020 | History

2 edition of Tax buoyancy vs elasticity in developing economy found in the catalog.

Tax buoyancy vs elasticity in developing economy

by Jane H. Leuthold

  • 394 Want to read
  • 27 Currently reading

Published by College of Commerce and Business Administration,University of Illinois at Urbana-Champaign in [Urbana] .
Written in English

    Subjects:
  • Economic development,
  • Tax returns

  • Edition Notes

    Includes bibliographic footnotes(p.14-15).

    StatementJane H. Leuthold, Tchetche N"Guessan
    SeriesBEBR faculty working paper -- no. 1272, BRBR faculty working paper -- no. 1272.
    ContributionsN"Guessan, Tchetche, University of Illinois at Urbana-Champaign. College of Commerce and Business Administration
    The Physical Object
    Pagination15 p. ;
    Number of Pages15
    ID Numbers
    Open LibraryOL24832825M
    OCLC/WorldCa706714296

    Tax buoyancy is an indicator to measure efficiency and responsiveness of revenue mobilization in response to growth in the Gross domestic product or National income. A tax is said to be buoyant if the tax revenues increase more than proportionately in response to a rise in national income or output. The objective of this study was to analyze the relationship between tax revenue and economic growth in Kenya for the period to The study applied the concepts of elasticity and buoyancy to examine the relationship between tax revenue and economic growth in .

    short- and long-run tax buoyancy in OECD countries between and We find that, for aggregate tax revenues, short-run tax buoyancy does not significantly differ from one in the majority of countries; yet, it has increased since the late s so that tax systems have generally become better automatic Size: KB. Tax elasticity and buoyancy can aid in identifying weaknesses in the tax structure and in formulating strategies to correct these weaknesses and improve the outturn on the fiscal accounts given the prevailing macroeconomic conditions, Cotton ().A desirable property of a tax system is that income.

      This paper examines the elasticity and buoyancy of the tax system for the period The elasticity of the total tax revenue both with respect to the total GDP and the non-agricultural GDP base is less than unity. Overall, sales tax takes the lead by way of improving revenues. C. Buoyancy and Elasticity Estimates The buoyancy coefficient of the total income tax system is for the period to Taking into account the effects of the discretionary changes, the elasticity inched up to which means that for every 1% increase in GNP, total taxes grew by %.


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Tax buoyancy vs elasticity in developing economy by Jane H. Leuthold Download PDF EPUB FB2

Taxbuoyancyvselasticityinadevelopingeconomy Tax buoyancy isa measure of the responsiveness of taxreceipts to economic ich is buoyant is one whose revenuesin. texts All Books All Texts latest This Just In Smithsonian Libraries FEDLINK Tax buoyancy vs elasticity in developing economy Item Preview remove-circle Share or Embed This Item.

Tax buoyancy vs elasticity in developing economy by Leuthold, Jane H; N'Guessan, Pages: The results of the study have important policy and research implications. TAX BUOYANCY VS ELASTICITY IN A DEVELOPING ECONOMY Tax buoyancy is a measure of the responsiveness of tax Tax buoyancy vs elasticity in developing economy book to economic growth.

A tax which is buoyant is one whose revenues in- crease by more than one percent for a one percent increase in national income or output. 36 BUOYANCY AND ELASTICITY OF TAX: EVIDENCE FROM GHANA. Daniel Kwabena Twerefou. Abel Fumey Eric Osei Assibey and Emmanuel Ekow Asmah Abstract.

In public finance, two important measures that have been used to assess the efficiency of any tax system in terms of itsFile Size: 1MB.

(Sahota, ). Further, an elastic tax system is also useful for the purpose of ensuring stability of the economy. In developing countries, which are highly susceptible to inflation, an elastic tax system provides an automatic check against inflation reducing the need for discretionary measures.

Thus, estimation of income elasticity of a taxFile Size: 1MB. Buoyancy and Elasticity of Tax Revenue: Measurement Techniques 89 = ∑ @ A (X) (X) The above identity states that overall elasticity is the weighted sum of the product of the elasticity of tax-to-base and base-to-income for each individual tax—the weights being the proportional share of individual taxes in total tax revenue.

Tax Elasticity: Elasticity is a preferred measure of tax responsiveness since it controls for automatic revenue changes.

In which we study, the buoyancies or elasticities of the major taxes in a representative developing economy, the Ivory Coast, are estimated using the alternative estimation techniques or comparisons between buoyancies or.

The elasticity and buoyancy of tax systems are concepts that have been widely studied in the public finance literature. By definition, elasticity is the change in tax revenue directly arising from a one unit change in income.

In other words, it is the proportionate change in tax to the proportionate change in income (Indraratna, ).File Size: KB. Tax Elasticity and Buoyancy 35 Tax Buoyancy Tax Elasticity Examples Summary Appendix: Computation of Buoyancy 4.

GDP Based Estimating Models 48 Dynamic versus Static Models Alternative Approaches Details of the Proportional Adjustment Approach Summary Appendix: Steps in Calculating Tax Elasticity 5. explore the determinants of buoyancy of taxes i.e.

the total tax, direct tax and indirect tax. The buoyancy of tax is defined as the total response of tax revenue in percentage term to a percentage change in GDP.

The study would have been more useful if we find the determinants of elasticity instead of by: Empirical evidence has shown that the buoyancy and elasticity of tax are two clear ways of measuring how tax revenue responds to changes in income.

This study adopted secondary data sets, which were sourced from CBN statistical Bulletin, National Bureau of statistics (NBS) and Federal Inland Revenue Service (FIRS) of Nigeria.

Estimating Tax Buoyancy, Elasticity and Stability Issue 11 of African economic policy discussion paper Volume 1 of Methodological note: Author: Jonathan Henry Haughton: Contributors: United States. Agency for International Development, Equity and Growth Economic Research/Public Strategies for Growth with Equity (Project) Publisher.

ELASTICITY AND BUOYANCY OF A TAX SYSTEM: PARAGUAY stated in identity (2), the elasticity of any separate tax may be decom-posed into the product of the elasticity of the tax to its base and the elasticity of the base to income.

(ATe W Be (B ET (Tx Y('XL) (2) Finally, as stated in identity (3), the elasticity of total revenue to. Tax buoyancy and elasticity is a common measure employed to estimate tax revenue productivity. Concept of elasticity is used to determine the level of responsiveness of automatic (built-in) of tax revenue to the tax base.

While the concept of buoyancy is useful to know responsiveness of tax revenue, both to the tax base and to changes in : nFN Nurhidayati. Decomposition of the buoyancy coefficients into tax-to-base and base-to-income elasticities showed that the former was greater than the latter by their indices indicating that there is potential revenue in the economy which is untaxed.

Overall tax elasticity was estimates to be aboutsuggesting that the responsiveness of the tax system to. Tax buoyancy vs elasticity in developing economy By Jane H. Leuthold and Tchetche N'Guessan Download PDF ( KB)Author: Jane H. Leuthold and Tchetche N&#;Guessan. This study extends the theoretical, methodological and empirical developments in tax elasticity and buoyancy estimation in several ways.

First, rather than assuming that the tax base is exogenous, it considers the very strong theoretical possibility that it may be endogenously determined by several factors such as structural shifts in the domestic economy; developments in the external economy. Tax elasticity and buoyancy estimates are the dynamic tools for measuring the tax performance.

The main objectives of the study are to explore the tax system performance of Zimbabwe through the. The tax buoyancy observed in Fig. 2 could result from a number of factors. First, the built-in flexibility, or fiscal drag, properties of the tax structure generate automatic changes in revenues as the tax base changes.

Second, revenues can be affected by discretionary changes in tax rates or other tax by: Elasticity and Buoyancy of the Tax System 75 The value of base to income elasticity does not depend on the progressivity of tax rates; it simply relates the responsiveness of the tax base to a change in income.

The growth of the base depends on the way the structure of the economy changes with economic growth. The elasticity coefficient refers to the tax system that is capable of generating maximum revenue from changes only in economic conditions, keeping the institutional set-up, tax rates and bases intact, while the tax buoyancy measures the revenue effect of both changes in economic conditions and exogenous File Size: KB.The paper examined the tax elasticity and tax buoyancy of Center, State and Combine government during to The study has used log regression model with the help of E-views software.

By how much will faster economic growth boost government revenue? This paper estimates short- and long-run tax buoyancy in OECD countries between and We find that, for aggregate tax revenues, short-run tax buoyancy does not significantly differ from one in the majority of countries; yet, it has increased since the late s so that tax systems have generally become Cited by: