Juvenal Domingos J'unior, Augusto Faria, Eduardo Seiti de Oliveira
et al.
This paper presents BR-TaxQA-R, a novel dataset designed to support question answering with references in the context of Brazilian personal income tax law. The dataset contains 715 questions from the 2024 official Q\&A document published by Brazil's Internal Revenue Service, enriched with statutory norms and administrative rulings from the Conselho Administrativo de Recursos Fiscais (CARF). We implement a Retrieval-Augmented Generation (RAG) pipeline using OpenAI embeddings for searching and GPT-4o-mini for answer generation. We compare different text segmentation strategies and benchmark our system against commercial tools such as ChatGPT and Perplexity.ai using RAGAS-based metrics. Results show that our custom RAG pipeline outperforms commercial systems in Response Relevancy, indicating stronger alignment with user queries, while commercial models achieve higher scores in Factual Correctness and fluency. These findings highlight a trade-off between legally grounded generation and linguistic fluency. Crucially, we argue that human expert evaluation remains essential to ensure the legal validity of AI-generated answers in high-stakes domains such as taxation. BR-TaxQA-R is publicly available at https://huggingface.co/datasets/unicamp-dl/BR-TaxQA-R.
The tobacco industry is a strategic sector the significantly contributes to national revenue through excise and taxation. However, high fiscal burdens may suppress the financial performance of companies operating in this sector. This study aims to examine the effect of excise burden, income smoothing practices, and effective tax rate (ETR) on the financial performance of tobacco companies listed on the Indonesia Stock Exchange (IDX). A quantitative approach as employed using multiple linear regression analysis. The data were obtained from secondary sources, namely annual reports of four tobacco companies over the period of 2021 to 2023, resulting in a total of 12 observations (N=12). The results indicate that excise burden has a significant negative effect on Return on Assets (ROA), income smoothing has a significant positive effect on ROA, and ETR also has a significant negative effect on ROA. These findings suggest that fiscal pressure from excise and taxation needs to be counterbalanced by adaptive managerial strategies, such as cost efficiency and healthy earnings management. The results align with cost theory, signaling theory, and agency theory. In conclusion, internal fiscal management plays a critical role in maintaining profitability under increasingly strict government regulations. Companies are advised to enhance cost control and tax planning as mitigation strategies against fiscal burdens. The practical implication of this study is to provide insights for corporate management and policymakers on the importance of balancing fiscal policy and industry competitiveness.
The simple swipe or tap of a credit card creates ripple effects that impact people and parties at every stage of the economic food chain. Throughout the last century, the credit card industry has been allowed to grow with practically no hindrance or foresight of its repercussions. Furthermore, the sector has been a well-documented engine of increasing financial inequality, representing an area of the economy that necessitates more forceful regulation. Legislation regarding the credit card industry has largely focused on increasing and clarifying consumer-facing disclosure and stamping out its most predatory practices; however, these laws have been unable to make meaningful progress in advancing financial equity. This Note argues that increased financial equity in this industry can be achieved by taxing the rewards that people earn from their credit cards as if those rewards were regular income. By engaging in such a taxing scheme, the U.S. Congress, the Internal Revenue Service, and the courts can set an effective example and signal that the credit card industry can no longer act as an unrestricted private marketplace operating outside the norms of taxation.
Kuishuang Feng, Xiangjie Chen, Daniele Malerba
et al.
Abstract Carbon taxation is regarded as an essential tool for curbing carbon emissions but can be regressive and increase poverty, and moreover lacks universal acceptance among the public and policymakers. Recycling the tax revenue raised to vulnerable households is one promising solution to this issue. However, little is known about the best strategy for designing such a policy at the global level. This paper investigates the effectiveness of various carbon taxation methods and revenue recycling mechanisms in reducing poverty and inequality between and within countries. We find that the policy mix with the highest poverty reduction potential is implementing a consumption tax with higher tax rates on luxury goods and recycling revenue through expanded social assistance systems, in line with the expansion during the COVID-19 pandemic. While differentiating tax rates across goods within countries is advantageous, the average tax level across countries is best kept uniform since it potentially offers governments in low- and middle-income countries more financial capacity to support the poor. Furthermore, collecting a global climate fund from developed countries and redistributing it to developing countries based on poverty headcounts can further significantly reduce poverty and inequality within and between countries. However, substantial improvements in social assistance systems are urgently needed to further unlock the poverty-reduction potential of revenue recycling, particularly in Sub-Saharan African countries. Also, recycling carbon tax revenues to combat poverty and inequality will inhibit the emission reduction effect of carbon taxation in the short term, necessitating additional mitigation efforts in other areas.
To fight evasion, many developing countries use production-inefficient tax policies. This includes minimum tax schemes whereby firms are taxed on either profits or turnover, depending on which tax liability is larger. Such schemes create nonstandard kink points, which allow for eliciting evasion responses to switches between profit and turnover taxes using a bunching approach. Using administrative data on corporations in Pakistan, we estimate that turnover taxes reduce evasion by up to 60–70 percent of corporate income. Incorporating this in a calibrated optimal tax model, we find that switching from profit to turnover taxation increases revenue by 74 percent without reducing aggregate profits.
Intan Puspanita, Mulyanah Mulyanah, Asih Machfuzhoh
et al.
This study aims to analyze the optimization of restaurant tax collection, especially during the Covid-19 Pandemic, describe the inhibiting factors for collecting restaurant taxes, and find out what efforts are made by the Serang Regency Regional Revenue Agency in optimizing restaurant tax revenues. The method used in this research is descriptive with an inductive approach and data collection techniques using observation, interviews, and documentation. The results of this study are the realization of the Restaurant Tax in Serang Regency is still not optimal, especially in 2020 and 2021, it has not yet reached the target, and it is even said to be very far from reaching the target. The Covid-19 pandemic limits human activities which has an impact on the decline in the economy in Indonesia. Restaurants are one of the things that have been affected by Covid-19. The enactment of the PSBB has caused restaurants to experience a decrease in visitors and even restaurants have gone out of business. This has an impact on the decline in restaurant turnover so that the amount of tax paid also decreases.
The advent of the Internet and other electronic means of conducting commercial transactions has created a new galaxy of ways to structure business operations and a concomitant range of novel tax issues. It is commonly said that, because of the diminished need for a vendor to have a physical presence in the country of the customer, one of the likely effects of electronic commerce will be to shift revenues away from source jurisdictions and towards residence jurisdictions. In fact, this may be only partially true. Income may be shifted away from the customers' countries all right, but into a tax haven jurisdiction rather than into the enterprise's home jurisdiction. A major issue for enterprises that use the Internet and their residence tax jurisdictions, therefore, will be whether controlled foreign corporation or similar legislation will operate to impose tax on any revenues that are shifted in this manner.The purpose of this paper is to consider how a hypothetical business operation structured to operate in a tax haven might be treated under United States federal income tax law, both under provisions taxing income at the source and under provisions taxing U.S. persons on tax haven income of foreign corporations, and then to reflect on what, if anything, this tells us about the need for change. Because the Internal Revenue Service has issued a regulation discussed below, specifically characterizing income derived from transactions in computer software (and not other types of transactions in electronic commerce), the paper will focus on a company delivering software over the Internet; but many of the issues presented will arise in the case of other Internet providers.
The study examined the relationship between tax revenue and economic growth in Nigeria. The study adopted a descriptive and historical research design; secondary data for twenty-two years (1994 -2015) were collected from various issues of the Central Bank of Nigeria (CBN) statistical bulletin and annual reports. Tax revenue as an independent variable was measured with Value Added Tax (VAT); Petroleum Profit Tax (PPT); Company Income Tax (CIT) and Custom and Excise Duties (CED) while the dependent variable was Economic Growth (EG) proxied by the Gross Domestic Product (GDP). Analysis was performed on data collected using Auto Regressive Distributed Lag (ARDL) Regression and other post estimations (Jarque-Bera test; Breusch-Godfrey LM and Ramsey Reset Test) to determine the existence of relationship between the variables. The results of the study showed that VAT and CED had a significant relationships with economic growth (p<0.05), while CIT has negative significant relationship with economic growth (P<0.05). However, PPT had no significant relationship with economic growth. The study concluded that the role of taxation in nation’s building is irreplaceable. Taxation remains a strong socio political and economic tool for economic prosperity. It is therefore recommended that government should engage in a complete re-organization of tax administrative machinery to reduce incidence of tax evasion and avoidance to the barest minimum in order to improve tax revenue and bring more people and establishments into the tax net. Also, tax revenue should be judiciously utilized to provide enabling environment for business survival and economic growth in Nigeria.
There is no rule without revenue. Since rule is ultimately based on coercion, any ruler needs to pay agents, who enforce the rules, and their matériel. Otherwise, disobedience and overthrow are likely to follow (Levi, 1988). Throughout history, rulers have relied on three main ways to obtain the required revenue. They have conquered or raided the owners and producers of resources, earned rents from the export of natural resources or have indebted themselves internally or abroad to finance their operations. All these have clear downsides: relying on conquest forces rulers to constantly expand, which is likely to result in imperial overstretch and defeat (e.g. Barkey, 1994; Neumann & Wigen, 2018); natural resources run out or drop in value depending on world market prices (e.g. Beblawi, 1987; Ross, 2015); and credit is only given so long as the promise of repayment is feasible – ultimately requiring another revenue stream to be credible (e.g. Centeno, 2002; Stasavage, 2011). Hence, most countries have evolved into Steuerstaaten (tax states) over time (Schumpeter, 1918). A notable exception remains North Korea, which abolished its taxes in 1974 (Genschel & Seelkopf, 2016). All other former communist countries have since then (re)introduced taxes to steer their capitalist economies.1 Nowadays, basically all states worldwide have at least some modern taxes in their revenue arsenal (Seelkopf et al., 2019) – albeit with varying histories, revenue sizes and mixes as this book will show. A tax is an “obligation to contribute money or goods to the state in exchange for nothing in particular” (Martin et al., 2009, p. 3). Direct taxes are imposed on income, wealth, or property, whereas indirect taxes are imposed on transactions and consumption. Moving into taxation requires rulers to engage in state building. They need administrations staffed with bureaucrats, who assess income and wealth, monitor transactions, and collect tax payments. To make taxation effective, rulers also need to prevent their subjects from hiding income, wealth, or transactions from bureaucrats. They can do this the authoritarian way and invest in enforcement and deterrence, or they can go the constitutional route and foster quasi-voluntary compliance among taxpayers (Karaman & Pamuk, 2013; Seelkopf, 2018; Levi, 1988). To this end, rulers need to build institutions that legitimate their rule by granting taxpayers the right of representation and some control over government spending. As a result, the state becomes more likely to provide public goods requested by its constituents (e.g. Dincecco et al., 2011; Levi, 1988). Given its intimate relationship with state building and representation, the move to taxation makes revenue collection highly political. Whereas resource rents and foreign loans have often prevented rulers from engaging with their subjects (e.g. Centeno, 2002; Queralt, 2019), or undermined already existing representative institutions (Ross, 2015), taxation has regularly entailed requests for political participation and control from domestic taxpayers. To be sure,
The maiden budget of the Akufo-Addo administration, presented by the Finance Minister on Thursday, March 2, 2021, saw the downward revision of certain taxes while others were completely abolished. According to Public Finance General Directorate, the purpose of taxation as enshrined in the French laws is “for the maintenance of public force and administrative expenses”. The need therefore to increase internally generated funds have been at the center stage of most developing countries, as Donor Partners insist on ensuring efficiency in tax administration before loans can be granted. Against the backdrop of tax cuts announced in the 2021 budget, this study seeks to evaluate the effect of tax cuts on revenue mobilization in the Wiawso Municipal Assembly of Ghana. The study employed the purposive sampling technique, making use of a population of 50. The result of the study showed that there is a strong negative relationship between tax cuts and revenue mobilization. Hence tax cuts can be assumed to reduce revenue mobilization. It also came to light that non-compliance was the main challenge facing the revenue collectors in the Wiawso Municipality. In the light of the above, the following recommendations were made. Government should support GRA by providing the necessary resources needed by the staff to carry out their daily activities effectively. For instance, the introduction of the taxpayer identification system. Technical training should also be organized regularly for GRA staff in other to help them acquire the necessary technical skills needed to carry out their activities effectively.
The Global economy has seen a rapid growth in digital business transactions, especially in the provision and sale of goods and services through the application of information and communications technology. This rapid growth can be attributed to the fast rate of technological advancement which has changed how business transactions are conducted globally. The complexity associated with the taxation of digital business transaction has created the need to take a critical look at the challenges and prospects of digital business transactions in developing economies. The absence of physically commercial environment to a digital business environment generates thoughtful and significant issues in relation to taxation and taxation systems. This study relied on the second-best Tax Theory to establish that developing economies face the daunting task of taxing digital business transactions effectively due to the distortive nature of taxes on welfare losses. Whereas government and revenue collection authorities can impose tax on individuals, institutions and or products, they cannot tax digital business transactions efficiently and effectively and unless there are robust and effective tax systems in place. Even though these constraints appear more pronounced in developing economies, the implementation of effective tax could lead to an enhanced internal tax revenue for development.
A major obstacle to cross-country research on the role of revenue and taxation in development has been the weakness of available data. This paper presents a new Government Revenue Dataset (GRD), developed through the International Centre for Tax and Development (ICTD). The dataset meticulously combines data from several major international databases, as well as drawing on data compiled from all available International Monetary Fund (IMF) Article IV reports. It achieves marked improvements in data coverage and accuracy, including a standardised approach to revenue from natural resources, and holds the promise of significant improvement in the credibility and robustness of research in this area. This paper sets out the issues with existing sources and explains the process of creating the new dataset, including a discussion of remaining limitations. It then presents data on tax and revenue trends over the past two decades, while a concluding section briefly considers potential strategies for, and barriers to, more effective data collection in future.