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This paper examines the influence of tax administration corruption on different types of innovation inputs and outputs in Vietnam. It utilizes firm-level panel data derived from biennial surveys of small and medium sized enterprises (SMEs) in Vietnam from 2005 to 2015. In terms of estimation method, the study applies the control function method for a dynamic binary response panel data model with endogenous explanatory variables, state dependence, and initial condition problems simultaneously. The key estimation results confirm the grease-the-wheels hypothesis that petty tax corruption positively affects all types of firm innovative activities. It is further found that innovation outputs and machinery innovation input of an SME are positively determined by its innovation 2 years earlier and innovation in the initial period. The key finding of the study implies that it is a challenge for governments in transition economies to fight against tax corruption, especially for Vietnam, which is known to be a high tax collection, high tax effort country. [ABSTRACT FROM AUTHOR]

This paper is motivated by the ongoing debate on university reform in Vietnam. In particular, there is a need to quantify the level of governmental support for public universities and examine whether or not such a support is adequate. To this end, the present paper estimates training costs per student in different disciplines within the Vietnamese public university education system in 2010. The various estimates of unit costs are based on the definitional approach which defines unit cost as the ratio of total costs over output. In measuring total costs, private costs incurred by university students (apart from formal tuition fees) are excluded. Further, the opportunity cost method employed emphasizes implicit costs such as imputed land rent. The total output is based on weighted student numbers. Unit costs are then estimated using a variety of primary (from survey) and secondary data sources. The results obtained suggest that the unit costs of public university education in Vietnam vary considerably between disciplines. The results also support the presence of economies of scale and scope in higher education and a negative relationship between unit costs and teaching quality proxies. The overall unit cost of public universities in Vietnam is very low in absolute terms when comparing with other countries. However, unit cost relative to GDP per capita in Vietnam is more comparable with those of neighboring countries. Nevertheless, the findings of the paper imply that more resources need to be allocated to the public university sector as part of an urgently needed university reform in Vietnam. [ABSTRACT FROM AUTHOR]

Most governments around the world rely heavily on tax revenue to fund not only their recurrent expenditure but also their long-term development goals. There is some evidence suggesting that tax evasion in Vietnam has, over the years, been on the rise in terms of number, scale and degree of sophistication. It may thus be beneficial to understand the extent to which various relevant psychological factors interact to influence the tax compliance of Vietnamese taxpayers. This chapter attempts to quantify the effects of taxpayer's emotion, trust and perception on their tax compliance in Vietnam. It adopts a positivist research framework, a quantitative research method and primary data collection. First, a simple, theoretical model in which emotion and trust affect tax compliance both directly and indirectly through perception as a mediating variable, is constructed. The Baron−Kenny method is then applied to the data collected from an e-survey to test various hypotheses derived from the devised theoretical model. The results show that taxpayer's perception positively and significantly influences tax compliance whereas emotion and trust exert significant and positive effects on tax compliance both directly and indirectly (via perception). The findings suggest that voluntary tax compliance in Vietnam can be improved through better tax administration services, more fiscal policy accountability and pro-active tax socialization. [ABSTRACT FROM AUTHOR]

Unlike previous studies focusing on the tax regimes of small and medium enterprises ('SMEs'), this article examines and analyses simplified tax regimes for micro, small and medium enterprises ('MSMEs'). Very recently, a simplified MSME tax regime was introduced in Egypt under the Micro, Small and Medium Enterprises (MSMEs) Law No 152 of 2020. This article employs an analytical and positive approach to assess these tax measures against the criteria of a good tax system and also evaluates the related implementation issues. The new tax measures include granting conditional tax exemption for capital gains and a dividend tax. Further, a separate MSME tax regime was introduced replacing the income tax provisions under the Income Tax Law No 91 of 2005. The MSME tax regime imposes a lump sum tax on micro businesses and an annual turnover tax at progressive rates on small businesses. The theoretical analysis and assessment of the MSME tax regime reveals the following: (i) the regime satisfies the economic efficiency criterion as it reduces the tax burden on SMEs, thus allowing to them to compete with larger businesses; (ii) it simplifies tax compliance procedures but is limited only to MSMEs registered with the MSME authority; (iii) the regime is inequitable as it discriminates between registered and non-registered MSMEs, and it does not consider their heterogeneity; (iv) there will be a decline in tax revenue collected from MSMEs, which represents a tax expenditure arising from the MSME regime; (v) there is a need for coordination of the regime with the Value-Added Tax Law; and, (vi) it is critical to establish measures that minimise resistance to the new system. [ABSTRACT FROM AUTHOR]

Tax non-compliance and perceptions of corruption are key challenges to state-building in developing countries. Using a social psychology approach, we develop a theoretical model in which different forms of perceived corruption can adversely influence the way individual taxpayers behave. We then apply this model to Indonesia, placing our empirical findings in the context of compliance risk management, identifying strategies to improve tax compliance, and exploring how to implement these strategies effectively. We shed light on the applicability of the traditional responsive regulatory approach (used by revenue authorities to deal with intentionally non-compliant taxpayers), which combines measures in attempting to achieve either voluntary or enforced compliance. While the empirical evidence is based on the Indonesian experience, we suggest that our model is sufficiently general and robust to be applicable to other developing countries in the Asia-Pacific region. [ABSTRACT FROM AUTHOR]

Abstract: This research reports an in‐depth study of the due diligence activities that prospective independent small business operators and franchisees in Australia undertake prior to purchasing or starting up their businesses. Although academic literature and industry publications promote undertaking ‘proper due diligence’, there is a lack of empirical research into the nature of due diligence and its effect on business outcomes. Using a qualitative approach, 60 currently and formerly operating independents and franchisees were personally interviewed, exploring the diversity of approaches to undertaking due diligence prior to entering business. The research revealed that differences occur in both the type and amount of due diligence undertaken by independents and franchisees and highlighted further differences between current and former operators. In general, the due diligence undertaken by participants was relatively unsophisticated with few exceptions of rigour and planning. Where prospective independents and franchisees were entering business for the first time, their appreciation of business was naïve. A steep learning curve followed during which they often recognised flaws in their initial research. As a result of this qualitative in‐depth research, we present a set of propositions regarding due diligence and a model for future testing on a large sample. [ABSTRACT FROM AUTHOR]

The goods and services tax (GST) or value-added tax (VAT) is the most rapidly spreading tax in the world. It accounts for a high proportion of tax revenue in both developing and developed countries. Despite its importance, there is a paucity of studies concerning GST/VAT avoidance. This article attempts to contribute to this relatively small body of literature by comparing and evaluating GST/VAT general anti-avoidance approaches in Australia and South Africa. Both countries have a similar common law heritage and adopted a similar GST/VAT model, although the tax commenced at different times in each country and the two taxes have slightly different bases. An examination of the Australian and South African GST/VAT anti-avoidance approaches reveals some interesting findings. The analysis undertaken by the authors suggests that, although there are differences in style in the drafting of the anti-avoidance rules, the effect of each appears to be similar in both countries. There would appear to be two differences. First, the Australian Commissioner of Taxation has a discretion, if the Commissioner thinks it fair and reasonable, to make a compensating adjustment to the other party to the transaction if that party is disadvantaged by the Commissioner's determination. Second, the "do nothing" defence which has been negated in Australia may possibly still be available in South Africa. [ABSTRACT FROM AUTHOR]

This article aims to develop a general statistical method for estimating tax compliance costs in Australia on an annual basis. The proposed approach represents an attractive alternative to the traditional, large.scale survey method which is known to be expensive and time.consuming to conduct. A state space mode is applied to a series of tax administrative costs, approximated by annual expenditures incurred by the Australian Taxation Office. This produces estimated annual growth rates of Australianfs tax compliance costs. Combining the growth rates obtained from the state space model with a comprehensive survey.based estimate of tax compliance costs in a particular year, an annual series of tax compliance costs can then be generated. Note that the proposed method has general applicability and the use of Australian data is a mere illustration. [ABSTRACT FROM AUTHOR]

The most recent, significant tax reform review in Australia, popularly known as the Henry Review, was publicly released just over six years ago. This article provides a critical examination of Australia's experience in tax complexity management since the Henry Review. Two main observations are put forward. First, not surprisingly, very few of the Henry Review's recommendations related to tax simplification have been implemented. The Henry Review has achieved relatively more with respect to personal income taxation than business income taxation. Second, tax complexity in Australia has been increasing since the Henry Review from both the legal and economic perspectives. An attempt is then made to explain why it is so hard to simplify the tax system in Australia and elsewhere. [ABSTRACT FROM AUTHOR]

Copyright of Canadian Tax Journal / Revue Fiscale Canadienne is the property of Canadian Tax Foundation and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

In this note Geoff Harcourt offers his views, via a face to face interview, on a wide range of issues relating to the discipline of economics. He recalls his time as a student at University of Melbourne, his choice of doctoral study and experiences at University of Cambridge, his original intellectual influences and affiliation, and his contributions to economics. He also discusses how economics have evolved over the years, comments on the current status of economic teaching, research and policy advice in Australia, and makes some recommendations to early career researchers. The note also includes a brief bio sketch of Professor Harcourt. [ABSTRACT FROM AUTHOR]

This article reports the results of an online survey of Australian tax practitioners conducted in May 2014. The purpose of the survey was to gain further insight into how tax changes impact on the role of tax practitioners in assisting their clients to comply with tax obligations (including tax planning). The survey was also designed to identify the possible managerial benefits that business taxpayers may derive from their relationship with a tax practitioner. This article focuses only on the first objective of the survey. The online survey attracted 241 respondents and analysis of the data obtained reveals a number of key findings, some of which are confirmatory. First, respondents see tax planning as being almost as important as tax compliance in their role as tax practitioners. As might be expected, the perceived importance of tax planning becomes stronger as firm size becomes larger. Second, respondents consider that the frequent changes to tax rules over the previous five-year period had an adverse impact on their practice and the nature of the tax services provided to their clients. They also perceive those frequent changes as a main driver of tax complexity. Third, respondents claim that they incur non-trivial annual costs of coping with tax changes and can ultimately pass on only a small proportion of these costs to their clients. Fourth, respondents exhibit a largely negative view about the impact of cumulative tax changes over the previous five-year period on their ability to advise clients with certainty, particularly in relation to tax planning; and on the time and stress associated with tax return preparation. [ABSTRACT FROM AUTHOR]

Corruption has been found to have complex effects on firm innovation. Limited theoretical and empirical evidence to date has been rather inconclusive. This study employs econometric estimation techniques to analyze data from small and medium manufacturing enterprises in Vietnam to assess the impact of petty corruption on firm innovation. The empirical results tend to support the 'greasing' impact of corruption on innovation. Specifically, informal payments by Vietnamese firms are shown to encourage overall innovation, product improvement, innovation and new innovation. In view of the commonplace business practice of paying small informal fees to speed up transactions in the inefficient public sector in Vietnam, this finding is not entirely unexpected, though troubling. [ABSTRACT FROM AUTHOR]

Numerous studies have looked at the effect of corruption on economic growth and a common finding is that the former adversely affects the latter. Through regression analyses, we use recent data from Transparency International's Corruption Perception Index (CPI) and the World Bank's Governance Indicators for the 2000-2012 period to test the direct and indirect effects of corruption on GDP growth rate. Our findings confirm that corruption metes out important costs in terms of lower economic growth when the direct method is considered. However, the indirect method shows that the impact of corruption on growth through the human capital (education) and domestic investment channels is positive, whereas the impact of corruption on growth through the voice and accountability channel is negative and statistically significant. Using these results, we examine the costs of corruption for Vietnam. We show that, had the CPI levels improved by just one unit between 2000 and 2012, then the economy would have grown from an average of 6.73 % during this period to 6.94 %. If corruption levels had fallen one standard deviation (i.e., the CPI increased from 2.6 to 5.0), then Vietnam could have achieved a growth rate of 7.22 %. This illustrates the primary finding that corruption undermines economic performance. [ABSTRACT FROM AUTHOR]

Reducing tax system complexity is a common goal amongst policymakers; yet there is no commonly agreed definition of complexity. This paper seeks to fill this gap, by proposing the construction of an index of tax system complexity, conceived as a summary indicator of the overall complexity of a tax system at a particular point in time. If adopted, such an index would not only enable assessment of the changing level of a country's tax system complexity over time, but may also facilitate comparisons of the relative complexity of different countries' tax systems in future. [ABSTRACT FROM AUTHOR]

Firms in the small and medium enterprise (SME) sector have to contend not just with the burden of tax. They also have to comply with obligations imposed by the tax system. Studies invariably show such tax compliance costs to be high and regressive. This article reports on a recent large-scale Australian study which confirm previous research and also suggests that tax compliance costs for SMEs are not diminishing over time, despite tax administrative reform and technological advances designed to reduce such costs. The outcomes of the study have significant implications for businesses in the SME sector, their advisers, administrators working with revenue authorities and policy-makers at the governmental level. [ABSTRACT FROM AUTHOR]

The paper reviews recent models that have applied the techniques of behavioural economics to the analysis of the tax compliance choice of an individual taxpayer. The construction of these models is motivated by the failure of the Yitzhaki version of the Allingham-Sandmo model to predict correctly the proportion of taxpayers who will evade and the effect of an increase in the tax rate upon the chosen level of evasion. Recent approaches have applied non-expected utility theory to the compliance decision and have addressed social interaction. The models we describe are able to match the observed extent of evasion and correctly predict the tax effect but do not have the parsimony or precision of the Yitzhaki model. [ABSTRACT FROM AUTHOR]

There has been a perception by the Australian public that 'big' Australian businesses do not pay their 'fair' share of income tax. This perception is primarily based on the belief that there exists a vast array of tax concessions available to companies in Australia. The present article examines the gap between taxable income and accounting profit of large Australian companies. This is achieved by estimating the effective tax rates (ETRs), defined as the ratio of income tax expense over accounting profit before tax, of 20 large (and highly visible) corporations in Australia for the six-year period from 2005 to 2010. Three measures of ETR, namely ETR, current and cash ETR are considered in this article. It is shown that while annual ETRs tend to fluctuate from year to year around the statutory tax rate, the aggregate ETRs of most companies are very close to the statutory tax rate. Thus, taxable income and accounting profit are very close for large Australian companies. These empirical findings are consistent with the Australian Government's income tax base broadening policy which has, over the past 25 years, removed most tax concessions to companies. [ABSTRACT FROM AUTHOR]

This paper investigates the impact of incorporating a Gossenian−Beckerian consumption time constraint into a simple Ricardian model. It is shown that in such a model the consumption gain from trade is zero, the specialization gain can be negative and a small nation devotes less labor to production after trade. [ABSTRACT FROM AUTHOR]

There is no doubt that the tax laws of many countries are complex and difficult to comply with administratively. In particular, Australia, New Zealand and the United States have tax systems that are generally recognized as complex especially for small businesses. They also have the distinction of having had a significant portion of their tax policy literature address the issue of complexity and its impact. What has been given scant recognition is the ability of different tax systems to learn from the successes and failures of each other. This article will try to bridge that gap by comparing tax advisers' perceptions of tax law complexities in these three jurisdictions that impact a crucial segment of the economy, small business. [ABSTRACT FROM AUTHOR]

This article suggests that the proposals for a standard deduction for work related expenses and the costs of managing tax affairs of individual taxpayers, due to be introduced from 1 July 2012, are flawed from a number of perspectives. After briefly reviewing international practice and examining the proposed policy option for Australia in some detail, the authors suggest that it might not be appropriate policy to provide such deductions in the first place. The article then identifies a number of difficulties associated with the policy design of the standard deduction, focusing on three specific issues: the take up ratio of the proposed standard deduction option; the revenue impact; and the potential simplification impact of the proposed policy. In the concluding section, some modifications or alternatives to the currently proposed standard deduction are suggested. Overall, it is concluded that the proposed policy will not achieve its policy objectives, and that - in particular - it is very unlikely that there will be any significant simplification outcomes as a result of the policy proposal. [ABSTRACT FROM AUTHOR]

The Australian Federal Government launched its Excellence in Research for Australia (ERA) initiative in February 2008. As part of the ERA exercise, the Australian Research Council (ARC), the peak research body in Australia, uses ranking of journals as a main indicator to assess research quality. In February 2010, the ARC released its revised ERA journal list in which academic journals of all disciplines are ranked into four tiers: A, A, B and C. The present paper intends to serve a two-fold purpose. First, it critically reviews the ARC's ranking methodology, with particular reference to tax journals. Second, it reports the findings of a study of Australasian tax academics' perception of tax journal ranking in general and the ARC's tax journal ranking in particular. The data of this study are obtained from an electronic survey of Australasian tax academics. A couple of findings emerge from the analysis of data. First, while recognising the importance of the ERA list, tax academics in Australia and New Zealand do not regard the ARC's current ranking of tax journals as reliable. Second, although the ARC's rankings of tax journals are compatible with the respondents' rankings of tax journals in the relative sense, ARC's rankings are in general lower than the rankings by the respondents. In particular, the perception of Australasian tax academics is that Australian Tax Forum should be ranked A, Australian Tax Review and perhaps New Zealand Journal of Tax Law and Policy should be ranked A. [ABSTRACT FROM AUTHOR]

We investigate a centrally planned, infinite horizon, single good economy in which new knowledge is generated in a separate R&D sector with government subsidy. The rate of growth of new ideas is assumed to be linear in the amount of labor devoted to R&D. Perpetual growth in per capita output and consumption is sustained by the spillover effects of knowledge creation. Using an isoelastic social welfare function and a general production function, the unique balanced growth path is characterized and the conditions for balanced growth to take place derived. In analyzing standard balanced growth, we demonstrate that so long as physical capital and knowledge grow at some arbitrarily constant rates along an optimal time path, the two rates must necessarily be equal. Using a Cobb–Douglas production function, the dynamic evolution of the economy is explicitly described in closed form for each state and control variables. In particular, it is shown that the economy either (i) attains the balanced growth path from the initial time, or (ii) converges monotonically to the balanced growth path. An asymptotic balanced growth path along which labor input in manufacturing tends to zero in the long run is ruled out by the tranversality condition on knowledge. [ABSTRACT FROM AUTHOR]

Abstract Tax compliance costs represent an important area of tax policy but have, until recently, been neglected by mainstream economists'. The introduction of the Goods and Services Tax (GST) in Australia on 1 July 2000 has heightened public interest in and concern for the simplification impact of tax reform. The GST Bills were accompanied by tile Government's Regulation Impact Statement (RIS), which provided an assessment of the GST on tax compliance and administrative costs. This RIS is by far the best known of its kind in Australia to date. This article argues that taxation RISs are generally not appropriate for policy evaluation because they focus on business taxpayers only. In particular, the RIS on the GST obscured the issue by the use of incorrect terminology and was not based on a valid perspective for policy evaluation. Using the same assumption as the Government, it is estimated that, contrary to the Government's claims, the GST would raise tax compliance costs by more than $1 billion annually. At the same time, it is also recognised that Australia's RIS process rates amongst the OECD's best practice. [ABSTRACT FROM AUTHOR]

As a result of decades of war and international isolation, Vietnam stands among the poorest nations on earth in terms of standard of living. Ten years of economic liberalization, a policy officially endorsed at Vietnam's Sixth Party Congress in 1986, have brought considerable benefits to the country and its population. There is now clear evidence that Vietnam's economic growth will slow down, not only due its own domestic problems, but also as a result of the current regional crisis affecting many of its top foreign investor nations. The principal aim of this paper is to review the last ten years of Vietnam's economic progress, and discuss potential overall policies and practical measures which Vietnam may consider adopting in order to sustain reasonable economic growth in the long run. The paper advocates a slower growth and faster human development approach based on a greater emphasis on human capital accumulation and a competent and relatively honest administration. [ABSTRACT FROM AUTHOR]

Proposes a procedure for estimating Engel elasticities using the Lorenz/concentration curve approach. Flexibility in permitting the estimation of standard errors; Presentation of empirical results using Australian unit record household expenditure.

This paper proposes a method of estimating total expenditure elasticities based on the implicit Engel equations derived from the Lorenz curve of total expenditure and concentration curves of commodity-specific expenditures. The proposed procedure is computationally easy to implement and produces elasticity estimates which appear to satisfy the adding-up criterion well For illustration, the method is applied to the 1984 Household Expenditure Survey and an attempt is made to compare the present estimates with those generated in previous Australian studies. [ABSTRACT FROM AUTHOR]

The paper describes an aggregative optimal growth model, the essential features of which are that individuals are mortal and obtain their labor skill through educational training. The process of human capital formation is described by an education function which relates the pass rate to the educational expenditure per student. Two alternative scenarios, private and public education regimes, are separately investigated. Under the decentralized education regime, risk-neutral individuals borrow to finance their education when young. Under the centralized education regime, the cost of education is financed by taxes imposed on the workers in the economy, and the central government maximizes a long-term social target function. The equilibria of both regimes are analyzed and various comparative static results derived. It is shown that educational investment in a decentralized equilibrium is higher than that in the centralized steady state. We also establish that there exists a time discount rate at which or above which the decentralized per capita consumption exceeds that of the centralized steady state whereas for time rates of discount sufficiently near the population growth rate, the above result will be reversed. [ABSTRACT FROM AUTHOR]