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on Informal and Underground Economics |
| By: | Apeti, Ablam Estel; Edoh, Eyah Denise |
| Abstract: | Making tax administration more efficient and maximising voluntary compliance is a very difficult task for developing countries. In this paper, we analyse the effect of mobile money payments on the quality of tax policy and administration for a large sample of countries in developing economies. We use the World Bank indicator on efficiency of revenue mobilisation as a measure of the quality of tax policy and administration and employ an entropy balancing method to show that mobile money payments improve the quality of tax systems. This result is robust to several robustness tests, including sample alteration, alternative measures of mobile money, controlling for other aspects of tax policy, and alternative estimation methods such as GMM-system, event study approach and ordinary least square. In addition, our results show that the positive effect of mobile money on tax systems depends on the level of development, financial development, the state’s legitimacy, a country’s fiscal space, the number of available products/companies, the type of mobile money services, and the geographic position of countries. Finally, we highlight some potential mechanisms underlying these findings through lower tax compliance burden, smaller informal sector, and lower corruption. |
| Keywords: | Economic Development, |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:idq:ictduk:18214&r=iue |
| By: | Pallavi Choudhuri (National Council of Applied Economic Research); Santanu Pramanik (Krea University); Sonalde Desai (National Council of Applied Economic Research) |
| Abstract: | The COVID-19 pandemic, and the consequent nationwide lockdown in India that began on March 25, 2020, caused a major disruption in the labour market, leading to the widespread loss of livelihoods and food insecurity. The findings from a telephonic survey of a representative sample of more than 3, 000 households in the National Capital Region (NCR) also reveal a dramatic loss in earning capacity. The place of residence and occupation mediated the impact of the lockdown, with greater vulnerabilities witnessed amongst those engaged in informal employment, especially in urban areas. The Government rolled out a series of welfare measures in response to the widespread economic distress, with the provision of free foodgrains and cash transfers aimed at rehabilitating those who were the most affected. While the use of prior social registries enabled quick disbursement, our analysis shows that few households received both foodgrains and cash transfers, particularly in urban areas. Urban residents were also eight percentage points less likely to receive cash transfers as compared to their rural counterparts. |
| Keywords: | Informal Employment, Income, Social Protection, Cash Transfer, COVID-19, India |
| JEL: | I38 J21 O17 |
| Date: | 2024–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:nca:ncaerw:156&r=iue |
| By: | Leonard Mushunje |
| Abstract: | Revenues obtained from the corporate tax heads play significant roles in any economy as they can be prioritized for producing public goods and employment creations, among others. As such, corporate tax revenue should be paid enough attention. This study, therefore, explores the tax-revenue harvesting system of an economy where we focused on the corporate tax head. The system comprises three players; the government and formal and informal firms. We applied the predator-prey model to model the effect of the government-gazetted tax rate on corporate survivability. It is a new approach to modeling economic system relations and games. Critical combinatory points are derived, with stability analysis provided after that. Dynamics associated with the tax-revenue system are established and critically analyzed. Lastly, we provide the mathematical way the system can be optimized for the government to harvest as much Revenue as possible, including optimal conditions. |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2401.13686&r=iue |
| By: | Cosmas Benard Meka'a; Astride Claudel Njiepue Nouffeussie; Romus Noufelie; Gaëlle Tatiana Timba |
| Abstract: | The objective of this article is to evaluate the effects of Information and Communication Technologies (ICTs) on the quality of youth employment in Cameroon. The study uses data from the Cameroonian Household Survey (CHS 4) carried out by the National Institute of Statistics of Cameroon (NIS) in 2014. The quality of employment is apprehended here by five of its dimensions: income by sector of activity, the nature of the contract, regularity of employment, job satisfaction and length of employment. Our results suggest that young active workers in the formal sector and the informal agricultural sector, demonstrating ICTs skills. |
| Keywords: | ICTs, youth, job quality, heckman model, Cameroon |
| JEL: | J13 J24 J64 J18 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10867&r=iue |
| By: | Agersnap, Ole (Yeh College, Princeton University); Bjørkheim, Julie Brun (Dept. of Business and Management Science, Norwegian School of Economics) |
| Abstract: | Most tax systems around the world are highly complex. While several economists have studied the potential costs associated with tax complexity, few have explored if complexity can also have beneficial effects. In a novel model where taxpayers can acquire costly knowledge to reduce their tax burden, we show that when elasticities of taxable income are heterogeneous, a complex tax system can act as a sorting device similar to second-degree price discrimination, where more elastic taxpayers will invest in more tax knowledge. We prove that if elasticities are increasing with income, introducing tax complexity can allow the government to raise higher tax revenues at no efficiency cost. However, we show that complexity primarily benefits the highest earners and thus exacerbates inequality. In the empirical section of our work, we study a complex tax system in Norway. Using rich register data on business owners, we demonstrate that many taxpayers make accounting decisions that cause them to pay higher taxes than would have been possible, and we quantify the exact size of this tax overpayment at the individual level. We show that overpayment tends to be larger for women, the less wealthy, and immigrants. We validate our model predictions by showing that failure to optimize is associated with a lower estimated tax elasticity. |
| Keywords: | Taxation; Personal Income Taxes; Fiscal Policies and Behavior of Economic Agents: Household; Tax Evasion and Avoidance |
| JEL: | H20 H24 H26 H31 |
| Date: | 2024–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhhfms:2024_004&r=iue |