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on Accounting and Auditing |
| By: | Szarowska, Irena |
| Abstract: | Enlargement of the European Union and the globalization process significantly affect tax systems and fiscal policies of individual countries. The level and structure of tax burden is often discussed in the European Union, as well as what is more profitable – keeping tax competition or tax harmonization. Tax environment and tax burden are significant factors when deciding about investment allocation. For international comparison, the easiest way is to use statutory tax rates but the result may be rather inaccurate. More convenient way of comparison is comparing implicit rates where we may express impact of taxes on economic activities according to their functions. The paper first summarizes basic theoretic approaches to tax competition. Then it is followed by an analysis of level and structure of tax burden in the European Union in the period of 1995 to 2006. There is emphasis on the dissimilarity of results depending on the type of tax rates used, namely statutory and implicit. The aim is to verify the hypothesis that value of tax burden (measured by tax quota) falls in time and that indirect taxes outweigh direct taxes in the tax burden of the European Union. |
| Keywords: | tax competition; tax burden; tax quota; implicit tax rate |
| JEL: | E62 F2 H2 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:19934&r=acc |
| By: | Pirtea , Marilen; Dima, Bogdan; Milos, Laura Raisa |
| Abstract: | Nowadays there is a large debate on whether the financial information proves any relevance for the investors´ prediction of the securities market values/stock prices. The paper focuses, besides reviewing some important literature concerning this issue, on an empirical analysis taking into consideration 44 companies listed on Bucharest Stock Exchange based on pool data linear regressions. It is true that the most recent research state that there is an important evidence of a deterioration of the relationship between accounting information and stock prices. Although, the main findings of this paper consist in that there are certain aspects which should be further examined for a more reliable conceptual approach. In addition, it concludes that - even in the case of an emergent capital market as Bucharest Stock Exchange - it can be found mixed evidences to support the importance of financial information in portfolio’ management decisions. In a sense or another, the paper state overall that the financial information matter for market determination of financial assets’ values. |
| Keywords: | capital markets; financial information; financial assets’ valuation |
| JEL: | C32 G14 D82 |
| Date: | 2009–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20084&r=acc |
| By: | Ojo, Marianne |
| Abstract: | The main argument of this paper is, namely, the need for greater emphasis on disclosure requirements and measures – particularly within the securities markets. This argument is justified on the basis of lessons which have been drawn from the recent Financial Crises, one of which is the inability of bank capital requirements on their own to address funding and liquidity problems. The engagement of market participants in the corporate reporting process, a process which would consequently enhance market discipline, constitutes a fundamental means whereby greater measures aimed at facilitating prudential supervision could be extended to the securities markets. Auditors, in playing a vital role in financial reporting, as tools of corporate governance, contribute to the disclosure process and towards engaging market participants in the process. This paper will however consider other means whereby transparency and disclosure of financial information within the securities markets could be enhanced, and also the need to accord greater priority to prudential supervision within the securities markets. Furthermore, the paper draws attention to the need to focus on Pillar 3 of Basel II, namely, market discipline. It illustrates how through Pillar 3, market participants like credit agencies can determine the levels of capital retained by banks – hence their potential to rectify or exacerbate pro cyclical effects resulting from Pillars 1 and 2. The challenges encountered by Pillars 1 and 2 in addressing credit risk is reflected by problems identified with pro cyclicality, which are attributed to banks’ extremely sensitive internal credit risk models, and the level of capital buffers which should be retained under Pillar Two. Such issues justify the need to give greater prominence to Pillar 3. As a result of the influence and potential of market participants in determining capital levels, such market participants are able to assist regulators in managing more effectively, the impact of systemic risks which occur when lending criteria is tightened owing to Basel II's procyclical effects. Regulators are able to respond and to manage with greater efficiency, systemic risks to the financial system during periods when firms which are highly leveraged become reluctant to lend. This being particularly the case when such firms decide to cut back on lending activities, and the decisions of such firms cannot be justified in situations where such firms’ credit risk models are extremely sensitive – hence the level of capital being retained is actually much higher than minimum regulatory Basel capital requirements. In elaborating on Basel II's pro cyclical effects, the gaps which exist with internal credit risk model measurements will be considered. Gaps which exist with Basel II's risk measurements, along with the increased prominence and importance of liquidity risks - as revealed by the recent financial crisis, and proposals which have been put forward to mitigate Basel II's procyclical effects will also be addressed. |
| Keywords: | Capital Requirements Directive (CRD); Post BCCI Directive; prudential supervision; liquidity; capital; maturity mismatches; regulation |
| JEL: | K2 G3 D82 D53 G2 F3 F21 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20013&r=acc |
| By: | Joel Slemrod (University of Michigan); Christian Traxler (Max Planck Institute for Research on Collective Goods) |
| Abstract: | We study the optimal observability of the tax base within the standard linear income tax problem, where observability is determined by the government’s investment into the accurate measurement of the tax base. We characterize the optimal level of observability and derive a new expression for the optimal progressivity, which – in addition to the standard equity efficiency trade-off – accounts for the limited accuracy of an income tax system. |
| Keywords: | optimal linear income taxation, observability, tax enforcement |
| JEL: | D8 H11 H21 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:mpg:wpaper:2010_04&r=acc |
| By: | Robert S. Chirinko (University of Illinois at Chicago); Daniel J. Wilson (Federal Reserve Bank of San Francisco) |
| Abstract: | The standard model of strategic tax competition assumes that government policymakers are perfectly benevolent. We depart from this assumption by allowing policymakers to be influenced by the rent-seeking behavior of businesses. Campaign contributions may affect tax competition and enhance or retard the mobility of capital across jurisdictions. Based on a panel of 48 U.S. states and unique data on business campaign contributions, we find that contributions have a significant direct effect on tax policy, the economic value of a $1 business campaign contribution is nearly $4, the slope of the tax reaction function is negative, and the empirical results are sensitive to state effects. |
| Keywords: | Campaign contributions, business taxation, state tax competition |
| JEL: | H71 H73 H25 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:2010/1/doc2010-2&r=acc |
| By: | Estrada, Fernando |
| Abstract: | This article describes the argumentative structure of Hayek on the relationship between tax policy and redistribution. It is observed throughout its work giving special attention to two of his works: The Constitution of Liberty (1959) and Law, Legislation and Liberty, Vol. 3, The Political Order of Free People af University of Chicago Press, Chicago, (1979) Hayek describes one of the most complete allegations on the SFP progressive tax system (progressive tax). According to the author the history of the tax system works against such a tax model. The author displays a variety of arguments on the ground preferred by his critics of liberal democracy |
| Keywords: | Tax Fiscal; Hayek; Buchanan; Political Economy |
| JEL: | E62 E64 E65 E60 |
| Date: | 2010–01–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20094&r=acc |