The Experts below are selected from a list of 252 Experts worldwide ranked by ideXlab platform
Michael Smart - One of the best experts on this subject based on the ideXlab platform.
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policy forum Business Tax reform in the united states and canada
Social Science Research Network, 2019Co-Authors: Kenneth J Mckenzie, Michael SmartAbstract:The authors examine some of the key features of the US Tax Cuts and Jobs Act (TCJA) and discuss the implications for Canadian corporations and government revenues. They show that the Tax advantage that Canada enjoyed prior to the TCJA has declined significantly, in terms of both statutory and effective (marginal and average) Tax rates. They discuss the economic effects of possible responses to the TCJA by Canadian governments, including cutting statutory rates and accelerating Tax depreciation deductions. Looking ahead, the authors argue that it would be preferable to focus on a more fundamental Tax reform based on the Taxation of economic rents.
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Tax policy next to the elephant Business Tax reform in the wake of the us Tax cuts and jobs act
C.D. Howe Institute Commentary, 2019Co-Authors: Kenneth J Mckenzie, Michael SmartAbstract:While there is considerable uncertainty regarding the US Tax Cut and Jobs Act’s (TCJA) economic and fiscal impacts, one thing is certain – the significant corporate Tax competitiveness advantage that Canada enjoyed over the US for years has disappeared. This Commentary explores some major TCJA measures as they relate to corporations, examines their implications for Canadian Business, evaluates Ottawa’s response in the Fall Economic Statement and discusses what is required going forward. The TCJA impact on real domestic investment in Canada is complicated, with competing effects. The TJCA will likely have a net negative effect on domestic and US foreign investment in Canada, moderated in the long-run by the international nature of capital markets. Still, concerns remain about income shifting due to the statutory rate reductions in the US. Our review of the academic literature suggests the US Tax-rate cut will result in Canadian affiliates of US companies shifting homeward 8 percent to 28 percent of their profits – a back-of-the-envelope calculation for sure, but nonetheless suggesting a potential significant impact on Canadian corporate Tax revenues. The TCJA represents a long overdue sea change in US corporate Taxation and, on balance, will have a positive impact on investment and productivity in that country. However, the reform is not anchored in sound Tax principles and introduces undesirable distortions. Ottawa, in its 2018 Fall Economic Statement, duplicated in part some aspects of the US reforms in accelerated depreciation for new capital expenditures. While we think that this short-run response is reasonable in light of the fiscal constraints facing the government and the uncertainty regarding the impact of the TCJA, we do not think that the work is done. The US reform provides an opportunity to make a bold move toward a corporate Tax system in Canada that is grounded in sound Tax policy principles, is less distortionary, promotes economic growth and prosperity, and restores Canada’s Tax competitiveness on a worldwide basis. A structured, principled approach to Tax reform in Canada is preferable than an ad hoc response to US developments, which may turn out to be fragile in light of the American political climate and the point in the Business cycle. We advocate for a corporate Tax system based on the Taxation of economic “rents.” A simple example of such a regime is a cash-flow Tax, which would involve the immediate write-off of all capital expenditures coupled with the elimination of the debt-interest deduction. The basic idea is to replace the corporate income Tax with a rent Tax that Taxes only the above-normal return on investment and is, therefore, neutral with respect to Business investment and financing decisions. A cash-flow Tax would reduce the Business cost of capital investment by roughly 20 percent – offering a much greater boost to capital investment than alternative and fractional reforms such as temporary accelerated depreciation or statutory Tax rate cuts.
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do fiscal transfers alleviate Business Tax competition evidence from germany
Journal of Public Economics, 2010Co-Authors: Peter Egger, Marko Koethenbuerger, Michael SmartAbstract:According to theory, capacity equalization grants cause local governments to internalize the effects of their Tax policies on revenues of neighboring jurisdictions and so raise equilibrium Tax rates. This paper empirically analyzes the incentive effects of equalizing transfers on Business Tax policy by exploiting a natural experiment in the state of Lower Saxony which changed its equalization formula as of 1999. We resort to within-state and across-state difference-in-difference estimates to identify the reform effect on municipalities' Business Tax rates. Confirming the theoretical prediction, the reform had a significant impact on the municipalities' Tax policy in the 4Â years after the reform with the effect stabilizing in the fourth to fifth years. The finding is robust to various alternative specifications.
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do fiscal transfers alleviate Business Tax competition evidence from germany
Social Science Research Network, 2007Co-Authors: Peter Egger, Marko Koethenbuerger, Michael SmartAbstract:The paper empirically analyzes the incentive effects of equalizing transfers on Business Tax policy by exploiting a natural experiment in the state of Lower Saxony which changed its equalization formula as of 1999. We resort to within-state and across-state difference-in-difference estimates to identify the reform effect on municipalities' Business Tax rates. Confirming the theoretical prediction, the reform had a significant impact on the municipalities' Tax policy in the four years after the reform with a "phasing out" of the effect starting in the fourth to fifth year. The finding is robust to various alternative specifications.
François Vaillancourt - One of the best experts on this subject based on the ideXlab platform.
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small Business and Tax compliance costs a cross country study of managerial benefits and Tax concessions
Social Science Research Network, 2014Co-Authors: Chris Evans, Sharon Smulders, Ann Hansford, John Hasseldine, Philip Lignier, François VaillancourtAbstract:Concern about the size and the regressive nature of Taxation compliance costs for small Businesses has prompted many governments to introduce special Tax concessions and regimes for that sector of the economy. This article reports on exploratory research conducted in four countries (Australia, Canada, South Africa and the United Kingdom) in 2010-11 utilising broadly similar survey instruments, designed to collect and collate data about the levels of compliance costs experienced by small Businesses; to identify the extent (if any) to which compliance with Tax obligations may have given rise to managerial benefits; and to evaluate the use and usefulness for the small Business sector of special Tax regimes designed to mitigate the burden of Tax compliance. In spite of some data limitations it finds remarkably similar outcomes in all four countries: Tax compliance costs remain high and regressive, and do not appear to be diminishing over time; many small Businesses are aware of the managerial benefits, in terms of better decision making and management of financial information that derives from Tax compliance, though few are able to place a value on those benefits; and legislated small Business Tax concessions do not appear to be making any difference to the burden of Tax compliance in the three countries that were considered in relation to that issue.
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Compliance and Administrative Costs of Taxation in Canada
2007Co-Authors: François Vaillancourt, Jason Clemens, Milagros PalaciosAbstract:There are a number of economic costs associated with Taxes, some of which unfortunately, are almost always ignored or misunderstood. The direct and most visible cost of Taxes is simply the Tax itself. It is the amount of earnings that individuals or Businesses forego when they pay Taxes. Put simply, an individual earns income but only receives a portion of it after paying for Taxes. This is the direct cost of Taxation: loss of income.Another cost of Taxes — which is often recognized but frequently not taken sufficiently into account in public policy discussions — is the incentive effects of Taxes. As noted above, Taxes create a wedge between what individuals and Businesses earn and what they actually receive for their efforts. The incentive costs from Taxes are a result of changed behaviour and foregone opportunities. For example, workers might decide to work less overtime because they deem the reward (that is, extra earnings) insufficient to compensate them for the extra effort. Similarly, Businesses might decide to forego expansion or investing in new Businesses if the after-Tax reward (adjusted for risk) is insufficient. In both these cases, society is less well off because of decisions that were made, in part, due to the effects of Taxes.The costs associated with complying with the Tax code are almost always ignored in public policy debates. Compliance costs include the time required to collect and organize receipts, accounting and other professional fees, the time required to complete Tax forms if professionals are not used, appeal costs if applicable, and the general costs of remitting returns. Similarly, the administrative costs incurred by governments to administer and collect Taxes are often ignored. In both cases, one explanation of this is the lack of quantitative estimates of these costs. This study will facilitate taking these costs into account.In 2011, between $19.2 billion and $24.8 billion was spent complying with the personal and Business Tax system in Canada. An additional $6.6 billion was collectively spent by governments across the country administering the Tax system. Should Canada choose to embark on fundamental Tax reform, this could reduce these costs by simplifying the Tax system.
Sharon Smulders - One of the best experts on this subject based on the ideXlab platform.
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Determinants of internal Tax compliance costs : evidence from South Africa
South African Journal of Accounting Research, 2016Co-Authors: Sharon Smulders, Madeleine Stiglingh, Riel Franzsen, Lizelle FletcherAbstract:Small Businesses tend to rely on external service providers (Tax practitioners, accountants, lawyers and bookkeepers) for assistance with their Tax affairs. Payments to external service providers clearly affect a small Business’s Tax compliance costs. This study uses multiple regression analyses to investigate the key drivers of small Business external Tax compliance costs. This will assist Revenue Services in understanding what factors (determinants) could increase a small Business’s external Tax compliance costs and might assist in managing Tax compliance behaviour and contribution.Overall, the results show that although the legal form, age, use of small Business Tax concessions, level of education of the respondents and the type of accounting system used are statistically significant determinants of external Tax compliance costs, turnover is the greatest determinant. The results also indicate that external Tax compliance costs are regressive in relation to the size of a Business, confirming previous re...
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small Business and Tax compliance costs a cross country study of managerial benefits and Tax concessions
Social Science Research Network, 2014Co-Authors: Chris Evans, Sharon Smulders, Ann Hansford, John Hasseldine, Philip Lignier, François VaillancourtAbstract:Concern about the size and the regressive nature of Taxation compliance costs for small Businesses has prompted many governments to introduce special Tax concessions and regimes for that sector of the economy. This article reports on exploratory research conducted in four countries (Australia, Canada, South Africa and the United Kingdom) in 2010-11 utilising broadly similar survey instruments, designed to collect and collate data about the levels of compliance costs experienced by small Businesses; to identify the extent (if any) to which compliance with Tax obligations may have given rise to managerial benefits; and to evaluate the use and usefulness for the small Business sector of special Tax regimes designed to mitigate the burden of Tax compliance. In spite of some data limitations it finds remarkably similar outcomes in all four countries: Tax compliance costs remain high and regressive, and do not appear to be diminishing over time; many small Businesses are aware of the managerial benefits, in terms of better decision making and management of financial information that derives from Tax compliance, though few are able to place a value on those benefits; and legislated small Business Tax concessions do not appear to be making any difference to the burden of Tax compliance in the three countries that were considered in relation to that issue.
Mariana Lopes Da Fonseca - One of the best experts on this subject based on the ideXlab platform.
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Tax mimicking in local Business Taxation quasi experimental evidence from portugal
Social Science Research Network, 2017Co-Authors: Mariana Lopes Da FonsecaAbstract:I exploit an exogenous reform introducing a local Business Tax in Portugal to study Tax mimicking among jurisdictions. The identification strategy relies on a quasi-experimental difference-in-differences methodology and heterogeneity in treatment intensity. Results provide evidence of significant short-run Tax mimicking that decreases over time. I study possible generating processes underlying the strategic interaction among municipalities and find significant evidence of electoral concerns. These electoral concerns are not met with electoral consequences at the local elections, which may be behind the diffusion of local Business Taxation in the long run.
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Tax mimicking in local Business Taxation quasi experimental evidence from portugal
Research Papers in Economics, 2017Co-Authors: Mariana Lopes Da FonsecaAbstract:I exploit an exogenous reform introducing a local Business Tax in Portugal to study Tax mimicking among jurisdictions. The identification strategy relies on a quasi-experimental difference-in-differences methodology and heterogeneity in treatment intensity. Results show evidence of significant short-run Tax mimicking that decreases over time. I study possible generating processes underlying the strategic interaction among municipalities and find significant evidence of electoral concerns. These electoral concerns are not met with electoral consequences at the local elections, which may be behind the diffusion of local Business Taxation in the long run.
Chris Evans - One of the best experts on this subject based on the ideXlab platform.
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small Business and Tax compliance costs a cross country study of managerial benefits and Tax concessions
Social Science Research Network, 2014Co-Authors: Chris Evans, Sharon Smulders, Ann Hansford, John Hasseldine, Philip Lignier, François VaillancourtAbstract:Concern about the size and the regressive nature of Taxation compliance costs for small Businesses has prompted many governments to introduce special Tax concessions and regimes for that sector of the economy. This article reports on exploratory research conducted in four countries (Australia, Canada, South Africa and the United Kingdom) in 2010-11 utilising broadly similar survey instruments, designed to collect and collate data about the levels of compliance costs experienced by small Businesses; to identify the extent (if any) to which compliance with Tax obligations may have given rise to managerial benefits; and to evaluate the use and usefulness for the small Business sector of special Tax regimes designed to mitigate the burden of Tax compliance. In spite of some data limitations it finds remarkably similar outcomes in all four countries: Tax compliance costs remain high and regressive, and do not appear to be diminishing over time; many small Businesses are aware of the managerial benefits, in terms of better decision making and management of financial information that derives from Tax compliance, though few are able to place a value on those benefits; and legislated small Business Tax concessions do not appear to be making any difference to the burden of Tax compliance in the three countries that were considered in relation to that issue.
