DOCSLIB.ORG

Tax Reforms: Experiences and Perspectives

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text

Load more

TAX REFORMS: EXPERIENCES AND PERSPECTIVES CONFERENCE PROCEEDINGS TAX REFORMS: EXPERIENCES AND PERSPECTIVES CONFERENCE PROCEEDINGS ZAGREB, 20 JUNE 2014 ZAGREB, 2014 Publisher Institute of Public Finance, Zagreb, Smičiklasova 21 http://www.ijf.hr For the Publisher Katarina Ott Computer typesetting Institute of Public Finance ISBN 978-953-6047-73-4 Institute of Public Finance, Zagreb, 2014 TAX REFORMS: EXPERIENCES AND PERSPECTIVES CONFERENCE PROCEEDINGS ZAGREB, 20 JUNE 2014 EDITORS: HELENA BLAŽIĆ, KATARINA OTT AND HRVOJE ŠIMOVIĆ REVIEWERS: DUBRAVKA JURLINA ALIBEGOVIĆ AND NIKŠA NIKOLIĆ ZAGREB, 2014 CONTENTS FOREWORD I PAPERS STJEPAN GADŽO AND IRENA KLEMENČIĆ Time to stop avoiding the tax avoidance issue in Croatia? 1 A proposal based on recent developments in the European Union SABINA HODŽIĆ AND LEJLA LAZOVIĆ‐PITA Evasion of social security contributions: the example of Croatia 25 and Bosnia and Herzegovina MAGDALENA MAŁGORZATA HYBKA Legislative proposal for controlled foreign companies regime 45 in Poland from an international perspective MIHAELA BRONIĆ AND VJEKOSLAV BRATIĆ 59 Can the efficiency of the Croatian tax authorities be improved? BIRGER NERRÉ, ALEKSANDAR DRAGOJLOVIĆ, SAŠA RANDJELOVIĆ AND MARINA DJENIĆ 79 Tax Reform in Serbia: experiences and perspectives VESNA PENDOVSKA AND ELENA NESHOVSKA Tax reforms: experiences and perspectives – 97 the case of the Republic of Macedonia HRVOJE ŠIMOVIĆ, HELENA BLAŽIĆ AND ANA ŠTAMBUK 121 Perspectives of tax reforms in Croatia: expert opinion survey MAJA KLUN 149 Slovenian experiences and lessons from tax reforms LEJLA LAZOVIĆ‐PITA 157 Income, personal income tax and transition: case of Bosnia and Herzegovina ILMĀRS ŠŅUCINS AND IEVA KODOLIŅA‐MIGLĀNE 179 Reform of labour taxes in Latvia ARTUR SWISTAK, SEBASTIAN WAWRZAK AND AGNIESZKA ALIŃSKA In pursuit of tax progressivity: lessons from VAT rate structure 197 adjustment in Poland NIKA ŠIMURINA AND MARKO PRIMORAC 219 The role of tax policy in the fiscal recovery of the European Union DIANE KRAAL 237 Tax Reform in Australia: The minerals resource rent tax TOMASZ JĘDRZEJOWICZ AND KAMILA SŁAWIŃSKA 245 Shifting from labour to consumption taxes: the impact on tax revenue volatility OLGA PALCZEWSKA Excise duties in Poland after accession to the European Union: 265 changes, impact on revenue and prospects for the future DEAN ŽUGČIĆ Evolution of tax systems in euro area crisis countries and former 275 transition economies that are now members of the European Union APPENDICES CONFERENCE PROGRAM 289 ORGANIZERS 292 DONORS 293 FOREWORD HELENA BLAŽIĆ, KATARINA OTT AND HRVOJE ŠIMOVIĆ EDITORS This year has marked the 20th anniversary of the Croatian tax reform. To celebrate this occasion, Institute of Public Finance, Zagreb; Faculty of Economics, University of Zagreb and Faculty of Economics, University of Rijeka have organized the international scientific conference Tax Reforms: Experiences and Perspectives. Croatian 1994 tax reform introduced completely new and modern „interest-adjusted“ consumption-based tax system of direct taxation. New personal income tax and corporate income tax were introduced as well as nine new excise taxes, followed by the VAT in 1998. Such a consumption-based system of personal and corporate taxation was the subject of numerous debates and confrontations of tax policy makers, academics as well as tax practitioners. With its second biggest tax reform in 2001 Croatia has abandoned interest- adjusted consumption-based tax system by reforming its personal and corporate income tax again in the direction of income-based system, introducing in effect hybrid system with income-based as well as consumption-based elements. This hybrid approach has remained in effect until today, with the slight occasional income-based or consumption-based changes. The basic conference aim was to compare experiences and draw lessons from tax reforms in different countries, particularly region countries and former transition economies that are now members of the EU. The conference was opened by the eminent keynote speakers - Gaëtan J. A. Nicodème (Head of the “Economic analysis, evaluation & impact assessment support” Unit– European Commission, General Directorate for Taxation and Customs Union), Sijbren Cnossen (Maastricht University and Erasmus University, Rotterdam) and Michael Keen (IMF, Washington). This basic conference aim was further analysed at the particular conference sessions. The prevailing topics were related to the broad tax reform issues in the region countries and new EU members. Furthermore, tax efficiency and equity, tax compliance and administration, tax avoidance and evasion were analysed. Substantial number of topics was dealing with macroeconomic aspects of tax reforms, particular in the times of crises, optimal tax structure as well as consumption versus labour tax burden. In accordance with authors’ preferences and limitations some of the articles presented at the conference are not present in this volume. However, the readers can see the scope of articles and topics in the program at pp. 289-291. These conference proceedings have been edited in appreciation of participating researchers’ effort to contribute to the qualitative research of tax reforms in different countries. Most of them come from the (post)transition countries, with the similar problems concerning not only taxation, but also general, issues. We really do hope that the variety of tax topics will help I H. BLAŽIĆ, K. OTT, H. ŠIMOVIĆ: FOREWORD researchers, students, experts and general public to get the insight into the complex problems of tax systems and policies of (post)transition countries. We also hope that the experience of other countries could be helpful in the everlasting search for the appropriate solutions in developing the efficient and equitable tax system. II TIME TO STOP AVOIDING THE TAX AVOIDANCE ISSUE IN CROATIA? A PROPOSAL BASED ON RECENT DEVELOPMENTS IN THE EUROPEAN UNION STJEPAN GADŽO, UNIVERSITY OF RIJEKA, FACULTY OF LAW, RIJEKA IRENA KLEMENČIĆ, INSTITUTE OF PUBLIC FINANCE, ZAGREB JEL CLASSIFICATION: K34 ABSTRACT The paper takes a tax policy perspective in analysing the approach to tax avoidance in Croatia and expounding its existing shortcomings. It is argued that Croatia is yet to develop a coherent legislative framework suitable for curbing tax avoidance in an equitable, efficient and simple way. One instrument that has hitherto been ignored is the general anti‐avoidance rule (GAAR), keystone of anti‐avoidance policy in other countries. Authors propose the introduction of a specific GAAR – based on recent developments in the European Union (EU) – in Croatian tax legislation. This proposal is supported by multiple tax policy arguments. Special emphasis is placed on the requirements of legal certainty, a traditional weak spot of Croatian tax system. The proposal is put in the context of persistent quest for sustainable public finance system in times of crisis. Keywords: tax avoidance, tax abuse, general anti‐avoidance rule, GAAR, EU tax law, wholly artificial arrangements, tax policy 1 INTRODUCTION “The avoidance of taxes is the only intellectual pursuit that still carries any reward.” (J.M. Keynes)1 Ever since its comprehensive reform in 1994 the Croatian tax system has exhibited distinct lack of coherent approach to tax avoidance. While global trends have been followed in introducing numerous targeted anti‐avoidance rules (TAARs), there is a gaping absence of statutory provisions which are able to curb more complex tax avoidance schemes. Legislative instruments that fit this purpose are the so‐called general anti‐avoidance rules (GAARs), recently on the rise in a number of countries (Ernst & Young, 2013), largely due to growing concerns about wealthy individuals and multinational corporations (MNCs) not paying their “fair share” in the financing of public services. Tax avoidance currently ranks high on the tax policy agenda worldwide, as evidenced by the G8 and G20 meetings of 2013 and other 1 As cited in Perrou (2006). S. GADŽO, I. KLEMENČIĆ: TIME TO STOP AVOIDING THE TAX AVOIDANCE ISSUE IN CROATIA? A PROPOSAL BASED ON RECENT DEVELOPMENTS IN THE EUROPEAN UNION developments at the regional and international level (e.g. OECD's project on tax base erosion and profit shifting). The institutions of the European Union (EU) have also taken the initiative in this area, stressing the need for a uniform anti‐avoidance approach in all of the EU member states. One of its envisaged cornerstones is the “EU GAAR”, as proposed by the European Commission (EC) in its non‐binding recommendation of 2012. The proposal is based on the anti‐avoidance approach developed by the EU judiciary in the past, which has had severe influence on member states' national legislation. Due to the lack of EU institutions’ competence in tax matters, the proposal's effects are contingent on the national tax policy choices of each member state. This paper takes on tax policy perspective in expounding that the time has come for the introduction of a GAAR – modelled after the EC’s proposal – in Croatian tax system. Arguments go beyond traditional examination of GAAR’s influence on efficiency and equity, paramount tax policy objectives. GAAR’s potential in recovering public revenues lost to tax avoidance activities and in narrowing the tax gap via improvement of tax compliance levels is highly important in the era of fiscal consolidation. Therefore, its introduction gives a strong signal to the country creditors that the government is acting responsibly in imposing and collecting
Recommended publications
  • Perspectives of Tax Reforms in Croatia: Expert Opinion Survey

    Perspectives of Tax Reforms in Croatia: Expert Opinion Survey

    Perspectives of tax reforms in Croatia: expert opinion survey HRVOJE ŠIMOVIĆ, PhD* HELENA BLAŽIĆ, PhD* ANA ŠTAMBUK, PhD* Article** JEL: H20 doi: 10.3326/fintp.38.4.2 * The authors would like to thank three anonymous referees and all participants of Session 1B at the confer- ence “Tax Reforms: Experiences and Perspectives” for their useful comments and suggestions. This work has been supported in part by the Croatian Science Foundation under project number IP-2013- 11-8174 and in part by the University of Rijeka under project number 13.02.1.2.02. ** Received: May 19, 2014 Accepted: September 22, 2014 A previous version of this paper was presented at the conference Tax Reforms: Experiences and Perspectives organized by the Institute of Public Finance, Faculty of Economics and Business, Zagreb and Faculty of Eco- nomics, Rijeka in Zagreb on June 20, 2014. Hrvoje ŠIMOVIĆ University of Zagreb, Faculty of Economics and Business, J. F. Kennedy 6, 10000 Zagreb, Croatia e-mail: [email protected] Helena BLAŽIĆ University of Rijeka, Faculty of Economics, Ivana Filipovića 4, 51000 Rijeka, Croatia e-mail: [email protected] Ana ŠTAMBUK University of Rijeka, Faculty of Economics, Ivana Filipovića 4, 51000 Rijeka, Croatia e-mail: [email protected] Abstract 406 In order to shape tax reform it is necessary objectively to assess the current state- of-the-art of and of the outlook for the tax system. After having reviewed all previ- ous reforms in the light of the consumption-based (interest-adjusted) concept of direct taxation, which was almost systematically implemented in Croatia in 1994, financial 38 (4) 405-439 (2014) practice we present the results of a broad expert opinion survey about the Croatian tax system.
  • Can the Efficiency of the Croatian Tax Authorities Be Improved?

    Can the Efficiency of the Croatian Tax Authorities Be Improved?

    Can the efficiency of the Croatian tax authorities be improved? MIHAELA BRONIĆ, PhD* VJEKOSLAV BRATIĆ, PhD* Article** JEL: H11, H83 doi: 10.3326/fi ntp.38.3.1 * The authors would like to thank two anonymous referees for their useful comments and suggestions. ** Received: May 26, 2014 Accepted: July 18, 2014 A previous version of this paper was presented at the conference Tax Reforms: Experiences and Perspectives organized by the Institute of Public Finance, Faculty of Economics and Business, Zagreb and Faculty of Economics, Rijeka in Zagreb on June 20, 2014. Mihaela BRONIĆ Institute of Public Finance, Smičiklasova 21, 10000 Zagreb, Croatia e-mail: [email protected] Vjekoslav BRATIĆ Institute of Public Finance, Smičiklasova 21, 10000 Zagreb, Croatia e-mail: [email protected] 254 Abstract The goals of this article were to determine whether the effi ciency of tax authorities in Croatia improved over the period 1997-2012 and to identify how their effi - ciency can be improved in the future. According to our research the administrative costs of taxation in Croatia, as a percentage of GDP, decreased slightly over the 38 (3) 253-275 (2014) PRACTICE FINANCIAL past fi fteen years but still remain above the EU average. Thus, there is a need to reduce the administrative costs of taxation, fi rst by identifying and abolishing THEORY nuisance taxes that raise very little revenue and have high administrative costs. Second, special attention should be devoted to analysing and reducing the service AND expenses of tax authorities (especially IT expenses and expenses for telephone, mail and transportation services).
  • Doing Business in Croatia This Document Describes Some of the Key Commercial and Taxation Factors That Are Relevant on Setting up a Business in Croatia

    Doing Business in Croatia This Document Describes Some of the Key Commercial and Taxation Factors That Are Relevant on Setting up a Business in Croatia

    Doing Business in Croatia This document describes some of the key commercial and taxation factors that are relevant on setting up a business in Croatia. dfk.com Prepared by iAudit d.o.o. +44 (0)20 7436 6722 2 Doing Business in Croatia Background Business environment in Croatia is Adriatic Sea, and the rural inland region, very favourable for investors. Excellent dominated by agricultural and geographical location enables access to industrial activities. the market of 650 million people and labour force in Croatian is effective, The country’s population of roughly 4.2 motivated and innovative which is million is largely homogenous in ethnicity, recognized by many foreign companies language and religion; but in the summer already operating in Croatia. months its numbers are doubled by tourists from throughout Europe and the world, making it a cosmopolitan market Country overview for products and services. Its ports and transportation infrastructure make Croatia Croatia is a small but complex market. a natural trade gateway into southeast Its geography divides it into two distinct Europe, but its largest trading partners markets - the more affluent and tourism are Italy, Germany, Slovenia and Austria. - oriented costal region along the dfk.com +44 (0)20 7436 6722 Doing Business in Croatia 3 Economic overview Transport infrastructure Croatia entered the European Union (EU) Transport in Croatia relies on several main on July 1, 2013 as the 28th member state. modes, including transport by road, rail, The government has been striving to raise water and air. Road transport incorporates Croatia’s competitiveness to compete in a comprehensive network of state, county the large EU market and maximize the and local routes augmented by a network opportunities that membership brings, of highways for long-distance travelling.
  • Child Tax Credit & Credit for Other Dependents

    Child Tax Credit & Credit for Other Dependents

    Child Tax Credit & Credit for Other Dependents Introduction The child tax credit is unique because if a taxpayer cannot benefit from the nonrefundable credit, the taxpayer may be able to qualify for the refundable additional child tax credit on Schedule 8812, Additional Child Tax Credit. In this chapter, we will learn about both credits and their relationship to each other. Some taxpayers may not be aware of these credits. Your time, effort, and understanding of this credit may result in a lower tax for the taxpayer. The child tax credit, credit for other dependents, and the additional child tax credit are entered on Form 1040. The intake and interview sheet, along with the Volunteer Resource Guide, Tab G, Nonrefundable Credits are critical tools needed to determine eligibility for the credit. Don’t confuse these credits with the child and dependent care credit! Objectives What do I need? At the end of this lesson, using your resource materials, you will be able to: □ Form 13614-C • Determine the taxpayer’s eligibility for the credit(s) □ Publication 4012 □ Publication 17 • Determine which taxpayer can claim the credits □ Publication 972 □ Schedule 8812 What is the child tax credit? Optional: The child tax credit is a nonrefundable credit that allows taxpayers to □ Form 1040 Instructions claim a tax credit of up to $2,000 per qualifying child, which reduces their □ Schedule 8812 Instructions tax liability. What is the additional child tax credit? Taxpayers who are not able to claim the full amount of the child tax credit may be able to take the refundable additional child tax credit.
  • Do You Have Children at Home and Need Money?

    Do You Have Children at Home and Need Money?

    Do You Have Children at Home and Need Money? Even if you have never filed taxes before and have little or no income, you are likely eligible for the Child Tax Credit of 2021, which is worth up to $3,600 per child. This is a big change. You can receive regular monthly advance cash payments between July and December 2021 of up to $300 per child per month! Most families don’t have to do anything to receive their Child Tax Credit payments. If you filed taxes this year (your tax return for 2020), filed last year (your tax return for 2019), or if you signed up for Economic Impact Payments (“stimulus checks”) using the IRS’s Non-Filer tool last year, you’re all set and the IRS will automatically send you monthly payments. If you haven’t filed taxes, it’s not too late to sign up to receive this credit! Sign up using the IRS and Code for America’s new mobile-friendly website: http://getctc.org/MEJ. Using this tool will set you up to receive the Child Tax Credit, as well as any stimulus payments you are eligible for but have not received. You can also sign up directly on the IRS’ website at: https://www.irs.gov/credits-deductions/child-tax-credit-non-filer- sign-up-tool. Note: Families who want to claim other tax benefits, such as the Earned Income Tax Credit, should not use this tool and instead file a regular tax return. You can get free help with your taxes.
  • Understanding the Expanded Child Tax Credit

    Understanding the Expanded Child Tax Credit

    Understanding the Expanded Child Tax Credit August 2021 What is the Child Tax Credit? The Child Tax Credit was first enacted in 1997 and has consistently helped families afford the everyday expenses of raising children. Until now, this has been done through a tax credit that some parents and caregivers could claim when they filed their taxes. Taxpayers who are eligible for the benefit are able to subtract its value from the total amount of taxes they owe. The American Rescue Plan, signed into law on March 11, 2021, makes the CTC available to more children and their families. It extends eligibility to the 23 million children—disproportionately Black and Latinx children—who previously did not qualify because their families make too little. It corrects a long-standing issue with the policy: reaching the kids who need help the most and doing right by our children. This expansion may significantly reduce child poverty and racial disparities this year, and in the long-term, it is likely to increase income security, provide flexibility and freedom to families, and invest in a brighter future for our children. What do I have to do to get the Child Tax Credit? Families who filed federal income taxes in 2020 or 2019 or signed up for the stimulus checks using the IRS’s non- filer portal last year will not need to take any additional steps to receive the benefit. On July 15, nearly 60 million children received the CTC benefit automatically, either via direct deposit to their bank accounts or in the form of a paper check.
  • The Earned Income Tax Credit and the Administration of Tax Expenditures, 90 N.C

    The Earned Income Tax Credit and the Administration of Tax Expenditures, 90 N.C

    NORTH CAROLINA LAW REVIEW Volume 90 | Number 3 Article 5 3-1-2012 The aE rned Income Tax Credit and the Administration of Tax Expenditures Jonathan P. Schneller Follow this and additional works at: http://scholarship.law.unc.edu/nclr Part of the Law Commons Recommended Citation Jonathan P. Schneller, The Earned Income Tax Credit and the Administration of Tax Expenditures, 90 N.C. L. Rev. 719 (2012). Available at: http://scholarship.law.unc.edu/nclr/vol90/iss3/5 This Article is brought to you for free and open access by Carolina Law Scholarship Repository. It has been accepted for inclusion in North Carolina Law Review by an authorized administrator of Carolina Law Scholarship Repository. For more information, please contact [email protected]. THE EARNED INCOME TAX CREDIT AND THE ADMINISTRATION OF TAX EXPENDITURES* JONATHAN P. SCHNELLER** The field of tax expenditure analysis has generally assumed a binary choice between tax expenditures and direct outlays. Because tax expenditures have multiple traits that are said to render them a suboptimal spending mechanism, scholars have tended to argue that they should be eliminated outright, or that they should be recast as direct expenditures. But despite such arguments, tax expenditures have proven to be a resilient (and politically popular) part of the American policy landscape, and in recent decades they have expanded in both number and size. This remarkable staying power suggests that tax expenditure analysis may do well to shift its focus from outright elimination to reforms that remedy or mitigate tax expenditures' more problematic attributes. This Article uses a case study of the Earned Income Tax Credit (EITC) to explore one particularly promising target for such reforms: the administration of tax expenditures.
  • Explanation of Proposed Income Tax Treaty Between the United States and Hungary

    Explanation of Proposed Income Tax Treaty Between the United States and Hungary

    EXPLANATION OF PROPOSED INCOME TAX TREATY BETWEEN THE UNITED STATES AND HUNGARY Scheduled for a Hearing Before the COMMITTEE ON FOREIGN RELATIONS UNITED STATES SENATE On June 7, 2011 ____________ Prepared by the Staff of the JOINT COMMITTEE ON TAXATION May 20, 2011 JCX-32-11 CONTENTS Page INTRODUCTION .......................................................................................................................... 1 I. SUMMARY ........................................................................................................................... 2 II. OVERVIEW OF U.S. TAXATION OF INTERNATIONAL TRADE AND INVESTMENT AND U.S. TAX TREATIES ....................................................................... 4 A. U.S. Tax Rules ................................................................................................................. 4 B. U.S. Tax Treaties .............................................................................................................. 6 III. OVERVIEW OF TAXATION IN HUNGARY .................................................................... 8 A. National Income Taxes ..................................................................................................... 8 B. International Aspects ...................................................................................................... 11 C. Other Taxes .................................................................................................................... 13 IV. THE UNITED STATES AND HUNGARY: CROSS-BORDER INVESTMENT AND
  • Publication 526, Charitable Contributions

    Publication 526, Charitable Contributions

    Userid: CPM Schema: tipx Leadpct: 100% Pt. size: 8 Draft Ok to Print AH XSL/XML Fileid: … tions/P526/2020/A/XML/Cycle04/source (Init. & Date) _______ Page 1 of 26 13:45 - 3-Mar-2021 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing. Publication 526 Cat. No. 15050A Contents What's New .................. 1 Department of the Charitable Reminders ................... 1 Treasury Internal Introduction .................. 2 Revenue Contributions Service Organizations That Qualify To Receive Deductible Contributions .............. 2 For use in preparing Contributions You Can Deduct ...... 3 2020 Returns Contributions You Can't Deduct ...... 7 Contributions of Property .......... 8 When To Deduct .............. 14 Limits on Deductions ........... 14 Substantiation Requirements ...... 20 How To Report ............... 22 How To Get Tax Help ........... 23 Index ..................... 26 Future Developments For the latest information about developments related to Pub. 526 (such as legislation enacted after we release it), go to IRS.gov/Pub526. What's New Cash contributions if you don’t itemize de- ductions. If you don’t itemize your deductions on Schedule A (Form 1040), you may qualify to take a deduction for contributions of up to $300. See Cash contributions for individuals who do not itemize deductions, later. Temporary suspension of limits for cash contributions. Certain cash contributions you made are not subject to the 60% limit for cash contributions. See Qualified cash contributions for 2020, later. Temporary increase in limits on contribu- tions of food inventory. The limit on contribu- tions of food inventory has increased from 15% to 25% for business taxpayers. See Food In- ventory, later.
  • PERSONAL INCOME TAX COMPLIANCE COSTS at an INDIVIDUAL LEVEL in CROATIA* HELENA BLAŽIĆ** This Paper Analyzes the Compliance

    PERSONAL INCOME TAX COMPLIANCE COSTS at an INDIVIDUAL LEVEL in CROATIA* HELENA BLAŽIĆ** This Paper Analyzes the Compliance

    PERSONAL INCOME TAX COMPLIANCE COSTS AT AN INDIVIDUAL LEVEL IN CROATIA* HELENA BLAŽIĆ** This paper analyzes the compliance costs of personal income tax only for individuals (non-business) in Croatia (made in 2002 and referring to the tax year 2001). It refers mostly to the “social” concept of compliance costs, but also takes into account the “taxpayer” compliance costs. It follows classical analysis from that field of the research adapted to Croatian circumstances. It is taken into account that some taxpayers fill in their tax returns during their regular working time and also that some tax returns are filled in by tax administration clerks. An attempt is also made to assess psychological costs. Personal income tax compliance costs are shown not to be high with respect to the hours spent, total monetary value as well as the psychological costs. The cash flow costs are relatively high. Keywords: tax compliance costs, personal income tax, Croatia 1. Introduction Taxation compliance costs have, in the last twenty-five years, been the subject of growing interest, especially in developed countries – on the part of both academics and governments. Still, research of that kind is very rare in the transition countries, * This research was supported by a grant from the CERGE-EI Foundation under a program of the Global Development Network. Additional funds for grantees in the Balkan countries have been provided by the Austrian Government through WIIW, Vienna. All opinions expressed are those of the author(s) and have not been endorsed by CERGE-EI, WIIW, or the GDN. Additional funds were provided by the Institute of Public Finance, Zagreb, Croatia – the institution that have conduced the project «Administrative and Compliance Costs of Taxation in Croatia».
  • ATI Working Paper

    ATI Working Paper

    WP/19/01 ATI Working Paper The evolution of property taxes in post- Socialist countries in Central and Eastern Europe Jan Brzeski Anna Románová Riël Franzsen The evolution of property taxes in post-Socialist countries in Central and Eastern Europe Jan Brzeski1 Anna Románová2 Riël Franzsen3 ABSTRACT This paper discusses the evolution of recurrent property taxes in transition economies of Central and Eastern Europe (CEE). The persistent use of an area-based property tax formula in some of these countries and the generally weak revenue performance of the property tax in most of these countries tend to slow the growth of urban productivity and, consequently, impact negatively on overall economic performance. It focuses on property taxation characteristics in these countries that are relevant to the urban (re)development challenges, describing in more detail the approaches in various countries, selected on the basis of their different tax-base formulae, revenue performance, reform directions and reform efforts. Lastly, the paper suggests possible ways forward to ensure a more significant role for the property tax in urban (re)development processes in CEE countries. Key words: CEE countries, post-Socialist economies, property tax, tax-base formulae JEL Classification: H71; P25; R51 1 International Property Tax Institute, Poland 2 Pavol Jozef Šafárik University in Košice, Slovakia 3 African Tax Institute, University of Pretoria, South Africa 1 1. Introduction ‘Transition countries’ constitute a wide range of post-Socialist economies in Central Europe, Eastern Europe, South-Eastern Europe, the Baltics, the Russian Federation and the former Socialist republics of Central Asia. These post-Socialist economies, undergoing a transition towards a market economy, have been facing a daunting challenge of reallocating their basic resources (i.e., land, capital, labour) and reshaping their ‘misdeveloped’4 cities towards higher urban productivity through more efficient use of urban land and buildings.
  • Effect of Expenditures in Personal Income Taxation on Horizontal Equity in Croatia

    Effect of Expenditures in Personal Income Taxation on Horizontal Equity in Croatia

    FINANCIAL THEORY AND hrvoje šimović: PRACTICE EFFECT OF EXPENDITURES IN PERSONAL INCOME TAXATION ON HORIZONTAL EQUITY IN CROATIA 245 36 (3) 245-267 (2012) Hidden Public Expenditure: the Future of Tax Tax of Future the Expenditure: Public Hidden 2 organized by the Institute of Public Finance in Zagreb on February 10, 2012. organized Received: December 28, 2011 The author would like to thank two anonymous referees and Dr. Ivica Urban for their useful The comments author and would like to thank two anonymous referees and Dr. on horizontal equity in in equity horizontal on suggestions. Hrvoje ŠIMOVIĆ University of Zagreb, Faculty of Economics and Business, J. F. Kennedy Square 6, 10000 Zagreb, Croatia University of Zagreb, Faculty of Economics and Business, J. F. e-mail: [email protected] Review article** UDC: 336.226(497.5) Croatia personal income taxation taxation income personal Accepted: March 12, 2012 doi: 10.3326/fintp.36.3.2 Expenditures Expenditures HRVOJE ŠIMOVIĆ, PhD* HRVOJE JEL: H24 A previous version of this paper was presented at the conference conference the at presented was paper this of version previous A Effect of expenditures in in expenditures of Effect ** * Abstract 246 Tax expenditures include all reliefs and other tax procedures used for reducing or deducting the amount of tax that would otherwise have to be paid by taxpayers. There are many personal income tax expenditures in Croatia and they represent an important segment of the tax and social policies. This paper analyses the effect 36 (3) 245-267 (2012) PRACTICE FINANCIAL of expenditures in personal income taxation in Croatia on horizontal equity.