Center for Taxation and Public Governance

· Rationales for government expenditures

· Trends in taxation

· Tax equivalences (income tax vs. VAT/GST)

· Assessment criteria for taxes/tax structures

· Tax competition

Topics:

Price: € 4,000

Governments need tax revenue in order to finance public spending. Various tax bases are generally used to raise revenue yet the actual tax structures (measured in terms of, for example, the share of indirect versus direct taxes) in most countries vary significantly.

In recent years, developed and developing countries alike, have increasingly substituted income taxation by consumption taxes. In addition, by now, most countries use a VAT/GST as one of the major sources of domestic tax revenue. One of the main drivers for this is the supposed neutrality and low costs of VAT/GST. Another trend is revenue neutral tax reforms in a large number of countries aimed at lowering marginal tax rates by base broadening. Some countries, notably former transition countries have gone even further by opting for a flat tax.

Increasing regional and international integration of economies has lead to a decrease in effective import and export duties, which have an immediate impact on government revenues. Increasing regional integration (e.g. regional free trade zones) also raises incentives for tax arbitrage and tax competition, mostly in income taxation (and excises). The available options for maintaining a sufficient level of domestic tax revenue thus appear to be limited.

 

This course discusses the relative merits of various tax interventions based on a uniform set of assessment criteria for taxes and tax structures:

Economic impact of taxation on employment levels, investment, trade patterns and possible even on growth levels;

Equity effects of taxation: consumption taxes are said to be regressive but the impact on post-tax income distribution of wage taxes and excises may not do much better;

Revenue estimation and its best practices;

Costs of raising revenue (for both tax administration and taxpayers).

Dr. Bjørn Volkerink

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