Author: Dina Deborah PomeranzPublisher:
ISBN:
Category :
Languages : en
Pages : 226
Book Description
Essays on Tax Evasion and Savings
Author: Dina Deborah PomeranzPublisher:
ISBN:
Category :
Languages : en
Pages : 226
Book Description
Essays in Tax Evasion
Author: Jorge Ricardo FriedmanPublisher:
ISBN:
Category :
Languages : en
Pages : 178
Book Description
Essays in Tax Avoidance and Evasion
Author: Jakob BrounsteinPublisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
Taxation is the primary means by which governments engage in the redistribution of resources and in the provision of goods and services. From determining the breadth and generosity of the social safety net to influencing broader societal inequality, taxation plays a central role in shaping our lives. Moreover, for the purposes of fortifying public coffers and promoting different kinds of egalitarian values to varying extents, the burden of taxation has, at least in principle, broadly evolved to fall disproportionately of those with the greatest concentration of resources, which we refer to as progressive taxation.However, taxation also often induces distortions in incentives and behavior; it is not profound to point out that taxpayers do not like paying taxes. Entire disciplines and industries have evolved so as to empower those with the most resources to mitigate their tax obligations. Indeed, much of the history of taxation features a perpetual arms race of tax authorities, who want to tax taxpayers, and taxpayers, who do not want to be taxed by tax authorities. A vast literature spanning many disciplines has studied the countless aspects of this relationship, with an emerging consensus that the combined sophistication of high earning taxpayers in mitigating their tax burdens and advancements in globalization and technology has grown to significantly undermine the process of taxation in facilitating redistribution as well as the provision of goods and services.This dissertation contributes this rich tradition of study in presenting new empirical evidence on the different kinds of activities--both legal (avoidance) and illegal (evasion)--that high-earning individuals and businesses take in order to lower their tax burdens.The first chapter focuses on the role of tax havens in facilitating tax avoidance and evasion, studying a novel policy in the Ecuadorian national setting and its impacts of tax haven usage. Tax haven usage (also referred to as “offshoring”, among other terms) facilitates an important source of tax evasion and avoidance in the world, where taxpayers by legal or illicit means locate their income and wealth in low-to-no-tax jurisdictions that also feature a great deal of financial privacy. Recent work estimates that nearly 10% of global household financial wealth, largely attributable to the wealthiest households, is held in tax havens (Zucman, 2013). However, due to its clandestine nature, tax haven usage is difficult to empirically study. Moreover, in light of the increasing sophistication of taxpayers and their tax preparers as well as the diminishing role of international financial borders, policy aimed at discouraging tax haven usage has seen limited effectiveness.I study a unique policy in Ecuador that adopts an unconventional approach in discouraging tax haven usage. While many policies focus on information sharing and enforcement, in 2008 Ecuador implemented a universal outflows tax that taxes (at least at the inception of the policy) all outflowing transactions. Additionally, the data that underlie the enforcement of the tax as well as subsequent legislative variation in the tax base and rate provide a highly novel environment for studying the behavioral dimensions of the relationship between incentives and tax haven usage. I ultimately produce evidence of an unprecedented success of this policy in reducing tax haven usage and increasing domestic income reporting. In short, individual tax haven users concentrated within the top 0.5% of the income distribution, in response to the imposition of the outflows that reduced the return of locating income/wealth abroad by 5%, increased their domestically reported income by around 40%; through the progressivity of the tax schedule, these individuals increased their personal income tax payments by 55%. The magnitude and persistence of this response is relatively unprecedented within the realm of anti-tax haven policy, and suggests a number of directions for the future research.The second chapter focuses on the roles of charities and nonprofits in facilitating estate tax avoidance in the United States. The US tax code features a wide array of exemptions and considerations for nonprofits in its design so as to encourage charitable activity. To this end, a sizable literature has focused on estimating the precise quantitative relationship between the different tax incentives extended to the nonprofit sector in the US and the amount of observable charitable activity. However, recent work has pointed out the means by which this system of charitability tax preference has been abused for the purpose of facilitating tax evasion and avoidance (e.g. Fack and Landais, 2012). Other work has even called into question the normative desirability of nonprofit activity in light of critiques of the ability of the nonprofit sector to effectively serve as a substitute for state capacity and its potential to facilitate private benefit.A long-standing literature has thoroughly documented a strongly positive, causal relationship between the estate tax rate, and charitable donations (which are fully deductible against the estate tax). The second chapter delves into this relationship, empirically studying recent federal and state estate tax reforms to demonstrate that nearly all of this long-standing relationship is driven by outsized responsiveness of private foundations (privately held nonprofits) as opposed to public charities (nonprofits that source their donations largely from the broader public) to the estate tax rate. The chapter also demonstrates the outsized scope of these private foundations to engage in potentially “privately-benefiting” activities in the form of payments, loans, and other financial relationships with administration and director networks. On a high level, the chapter argues that the private foundation, as a tax exempt vehicle, disproportionately facilitates tax mitigating activity while demonstrating substantial scope for fulfilling private benefit, as opposed to the supposed public benefit that serves as the premise for the broader social desirability of nonprofit entities and their tax privilege.
Essays on Taxation and Transfers in Middle-Income Countries
Author: Pierre BachasPublisher:
ISBN:
Category :
Languages : en
Pages : 151
Book Description
At a time of growing inequality and under-investment in public infrastructure, my re- search has focused on understanding governments' constraints in raising tax revenue and providing redistribution. These challenges are particularly important for low and middle- income countries: despite improvements in their institutional capacity in the last decades, their ratios of tax revenue to GDP remain much lower than OECD countries' (Besley and Persson 2013a), and their tax and transfer systems are often distributionally neutral, instead of progressive. In the first chapter, I ask whether developing countries with limited information and tax capacity can use the corporate income tax to raise additional revenue, and design it optimally given these constraints. I explore this question for Costa Rica, using the universe of corporate tax returns and a novel methodology which exploits the country's unique tax design: firms with marginally different revenue face discontinuously higher average tax rates. This notch feature allows me to first estimate the elasticity of profits with respect to the tax rate, and second to separate it into its components, namely the revenue and cost elasticities. I find that firms facing a higher tax rate slightly decrease reported revenue, but considerably increase reported costs, leading to a large drop in reported profits. Using additional data sources, firms' behavioral responses appear to occur through tax evasion, with no evidence of production responses. Taken together, this implies that Costa Rican firms evade taxes on a massive 70% of their profits when faced with a 30% tax rate. In this context, lowering corporate tax rates could increase tax revenue, since we estimate the revenue maximizing rate to be below 25%. Alternative tax rules, that limit the deductibility of costs could be preferable since they would reduce evasion opportunities on this crucial margin. The results highlight the limitations of standard business taxation as an instrument to raise revenue in developing countries. The first chapter points to limitations for revenue collection, when given the current enforcement environment. In the Second Chapter, I study how third-party information might spread to the government, in order to improve tax enforcement. Firm level tax compliance depends on the stock of information accessible to the government. Theoretical work (Gordon and Li 2009b, Kleven, Kreiner, and Saez 2016) highlights two specific information trails: access to formal finance and the number of employees. I test whether firms with more employees and with access to formal finance are more likely to be audited and less prone to evading taxes. I use firm-level data on 108,000 firms across 79 countries in the World Bank Enterprise Surveys and construct instruments for finance and worker-size at the industry level, using an out of sample extrapolation strategy related to Rajan and Zingales (1998). The instruments isolate variation in industry technological demand for labour and formal finance by taking the US industry distributions as undistorted benchmarks. I find that firms with more employees are more likely to be audited and to comply, but find no evidence that firms using the financial sector are under higher scrutiny. Finally, in the third chapter, I turn to the redistributive role of governments, and study how a new technology to deliver cash transfers can be used to impact transfer beneficiaries' trust in financial institutions and their savings behavior. It is well documented that trust is an essential element of economic transactions, however trust in financial institutions is especially low among the poor, which may explain in part why the poor do not save formally. Debit cards provide not only easier access to savings (at any bank's ATM as opposed to the nearest bank branch), but also a mechanism to monitor bank account balances and thereby build trust in financial institutions. I study a natural experiment in which debit cards were rolled out to beneficiaries of a Mexican conditional cash transfer program, who were already receiving their transfers in savings accounts through a government bank. Using administrative data on transactions and balances in over 300,000 bank accounts over four years, I find that after receiving a debit card, the transfer recipients do not increase their savings for the first 6 months, but after this initial period, they begin saving and their marginal propensity to save increases over time. During this initial period, however, they use the card to check their balances frequently; the number of times they check their balances decreases over time as their reported trust in the bank increases. Using household survey panel data, I find the observed effect represents an increase in overall savings, rather than shifting savings; I also find that consumption of temptation goods (alcohol, tobacco, and sugar) falls, providing evidence that saving informally is difficult and the use of financial institutions to save helps solve self-control problems.
Essays on Tax Avoidance and Financial Markets
Author: Denis GoreaTwo Essays on Tax Evasion
Author: Omar S. AriasEssays on Tax Evasion
Author: Edward SennogaEssays on Tax Evasion
Author: Xiwen FanGlobal Tax Fairness
Author: Thomas PoggePublisher: Oxford University Press
ISBN: 019103861X
Category : Business & Economics
Languages : en
Pages : 383
Book Description
This book addresses sixteen different reform proposals that are urgently needed to correct the fault lines in the international tax system as it exists today, and which deprive both developing and developed countries of critical tax resources. It offers clear and concrete ideas on how the reforms can be achieved and why they are important for a more just and equitable global system to prevail. The key to reducing the tax gap and consequent human rights deficit in poor countries is global financial transparency. Such transparency is essential to curbing illicit financial flows that drain less developed countries of capital and tax revenues, and are an impediment to sustainable development. A major break-through for financial transparency is now within reach. The policy reforms outlined in this book not only advance tax justice but also protect human rights by curtailing illegal activity and making available more resources for development. While the reforms are realistic they require both political and an informed and engaged civil society that can put pressure on governments and policy makers to act.
Essays in Tax Evasion
Author: Jorge Friedman R.Publisher:
ISBN:
Category : Tax evasion
Languages : en
Pages : 98
Book Description