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on Accounting and Auditing |
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Issue of 2017‒07‒23
seven papers chosen by |
| By: | António Afonso; Florence Huart; João Tovar Jalles; Piotr Stanek |
| Abstract: | We assess the sustainability of the current account (CA) balance, net international investment position (NIIP) and net external debt (NED) in a sample of EU countries using two complementary approaches. First, we employ both time-series and panel-data stationarity tests of current account balance-to-GDP ratios as well as cointegration tests of exports and imports of goods and services. Second, we assess the level of trade balance that stabilizes the NIIP and the NED. We find that there is sustainability of the CA balance mainly in a few surplus countries whereas there is more concern about the sustainability of the NIIP or NED in countries with a credit position than in countries with a debit position. Both approaches are consistent with each other given the relationship between flows and stocks, the existence of important structural breaks, and valuation effects via the exchange rate. Key Words : current account, exports, imports, net foreign assets, unit roots, structural breaks, cointegration, error-correction, cross-sectional dependence. |
| JEL: | C22 C23 F32 F34 F36 F41 |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:ise:isegwp:wp102017&r=acc |
| By: | Stefano Boscolo |
| Abstract: | In recent years some types of incomes have been excluded from the Irpef tax base and subjected to alternative proportional systems or totally exempted from imposition. This has contributed to make the Italian personal income tax even more selective, accentuating the problems of horizontal equity that have accompanied it since its birth in 1974. The aim of the working paper is to calculate the redistributive effects following the erosion of the Irpef tax base, as well as the distribution of the fiscal benefits and burdens by deciles of total income and social categories under the alternative tax rules considered. Using a static microsimulation model, I compare two different versions of the personal income tax within the counterfactual logic: on the one hand, the Irpef with the current 2017 rules; on the other hand, a hypothetical income tax that takes as reference point the Comprehensive Income Tax (Cit) model and includes in its base all forms of income that are currently not subject to Irpef. |
| Keywords: | microsimulation model; Irpef; Personal Income Tax; Comprehensive Income Tax; redistributive effects |
| JEL: | D3 H2 |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:mod:cappmo:0154&r=acc |
| By: | James Alm (Department of Economics, Tulane University); Mir Ahmad Khan (Federal Board of Revenue, Government of Pakistan) |
| Abstract: | The Pakistan system of taxing enterprises has undergone major changes in recent years. Nevertheless, the corporate tax system remains plagued by a number of problems, problems that relate to the neutrality, the yield, and the simplicity of the tax system. This chapter discusses these issues, with a focus on the distorting effects of tax policy on business invest. |
| Keywords: | Corporate income tax, effective tax rate, tax reform. |
| JEL: | H20 H25 H32 H87 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:1705&r=acc |
| By: | Dora Benedek; Pragyan Deb; Borja Gracia; Sergejs Saksonovs; Anna Shabunina; Nina T Budina |
| Abstract: | Some countries support smaller firms through tax incentives in an effort to stimulate job creation and startups, or alleviate specific distortions, such as financial constraints or high regulatory or tax compliance costs. In addition to fiscal costs, tax incentives that discriminate by firm size without specifically targeting R&D investment can create disincentives for firms to invest and grow, negatively affecting firm productivity and growth. This paper analyzes the relationship between size-related corporate income tax incentives and firm productivity and growth, controlling for other policy and firm-level factors, including product market regulation, financial constraints and innovation. Using firm level data from four European economies over 2001–13, we find evidence that size-related tax incentives that do not specifically target R&D investment can weigh on firm productivity and growth. These results suggest that when designing size-based tax incentives, it is important to address their potential disincentive effects, including by making them temporary and targeting young and innovative firms, and R&D investment explicitly. |
| Keywords: | Productivity;size-based taxation, growth, structural reforms |
| Date: | 2017–06–13 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:17/139&r=acc |
| By: | Daniela Mantovani |
| Abstract: | In empirical analysis, the Kakwani index is the most frequently used indicator for comparing progressivity across countries and over time. The Kakwani is often assumed to measure to what extent a policy design is targeted to the poor. It has, however, a major drawback: it is not defined for net tax incidence—that is, the whole system of taxes and benefits. Moreover, it is defined over different intervals for different pre-tax income distributions and different average tax rates. This paper proposes an index based on the concept of relative redistributive efficiency that is not affected by these drawbacks. The Redistributive Efficiency index was compared to the Kakwani index for taxes/benefits in EU countries by using Euromod baselines. In addition, the Redistributive Efficiency index was computed on the whole tax-benefit system; that is, taxes and benefits were evaluated together. Only Ireland and the UK combine high levels of redistributive efficiency with a relevant amount of tax revenues and social expenditures. They obviously obtain very high redistribution, above 15 points. Most of the countries considered show an intermediate level of redistribution (between 7 and 12 points), but with a different mix. A group of Central and Northern European countries plus Slovenia and Hungary combine medium levels of redistributive efficiency and medium size, while some Southern European countries (Spain and Portugal) and new members compensate a rather low amount of transfer and taxes with quite high levels of efficiency. The remaining new member states and Southern EU countries show a very low level of redistribution, below 7 points. Interestingly, they vary in the level of tax burden and of resources devoted to benefits but all of them show a poor Redistributive Efficiency. This suggests that low Redistributive Efficiency plays a key role in explaining why certain countries perform a limited amount of redistribution. |
| Keywords: | income Redistribution; Progressivity, Microsimulation; EUROMOD |
| JEL: | C00 D31 H20 I38 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:mod:cappmo:0155&r=acc |
| By: | DOMBOU T., Dany R. |
| Abstract: | This study investigates the influence of institutional pressures on the level of entrepreneurship in Sub-Saharan Africa (SSA). It assumes that in sub-Saharan Africa, countries with the highest levels of entrepreneurship rates tend to have the highest levels of economic freedom. Data are on 37 SSA countries and come from The Heritage Foundation and the World Data Indicator. Equations are estimated using the ordinary least squares method. The main results show that a less restrictive institutional environment tends to encourage entrepreneurship. Low levels of fiscal pressure significantly encourage entrepreneurship up to 114% of the levels of tax freedom. The results also show that women entrepreneurs are much more sensitive to tax pressure than their male counterparts. Finally, the results show that entrepreneurs tend to evolve in the informal sector, or to submit false accounting balances to the tax authorities in order to avoid tax burden (Women entrepreneurs in this case being either more entrepreneurial than their male counterparts or more Honest), which has a negative impact on their ability to benefit from external funding. The main recommendation goes to governments, they must reduce the tax pressures linked to small activities. And to do this, they must order microeconomic studies to determine which taxes to reduce and at which level. |
| Keywords: | Entrepreneurship; Economic freedom; Tax burden; Financial inclusion; gender; |
| JEL: | E02 L26 O43 O55 |
| Date: | 2017–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:80242&r=acc |
| By: | Duro, Miguel; Heese, Jonas; Ormazabal, Gaizka |
| Abstract: | This paper studies the effect of the public disclosure of the Securities and Exchange Commission (SEC)'s oversight activity on firms' financial reporting. We exploit a major change in the SEC's disclosure policy: in 2004, the SEC decided to make its comment-letter reviews publicly available. Using a novel dataset of SEC comment letters (CLs), we analyze the capital-market responses to firms' quarterly earnings releases during SEC reviews conducted before and after the policy change. We find that these responses increase significantly following the policy change. Consistent with public disclosure of CLs increasing market discipline, we find that this relative increase is stronger among firms with higher percentages of dedicated institutional investors or independent directors. In contrast, we do not find conclusive evidence that public disclosure of CLs increases SEC oversight intensity. Corroborating these results, we also document a set of changes firms make to their accounting reports during these reviews. Our results indicate that the public disclosure of regulatory oversight activities can enhance the effect of these activities. |
| Keywords: | Disclosure Rules; SEC comment letters; SEC oversight |
| JEL: | M41 |
| Date: | 2017–07 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12145&r=acc |