G2TT
来源类型Faculty Working Papers
规范类型工作论文
来源IDCID Faculty Working Paper No. 361
Tax Administration vs Tax Rates: Evidence from Corporate Taxation in Indonesia
M. Chatib Basri; Mayara Felix; Rema Hanna; Benjamin A. Olken
发表日期2019-10
出版年2019
摘要

Developing countries collect a far lower share of GDP in taxes than richer countries. This paper asks whether changes in tax administration and tax rates can nevertheless raise substantial additional revenue – and if so, which approach is most effective. We study corporate taxation in Indonesia, where the government implemented two reforms that differentially affected firms. First, we show that increasing tax administration intensity by moving the top firms in each region into “Medium-Sized Taxpayer Offices,” with much higher staff-to-taxpayer ratios, more than doubled tax revenue from affected firms over six years, with increasing impacts over time. Second, using non-linear changes to the corporate income tax schedule, we estimate an elasticity of taxable income of 0.59, which implies that the revenue-maximizing rate is almost double the current rate. The increased revenue from improvements in tax administration is equivalent to raising the marginal corporate tax rate on affected firms by about 23 percentage points. We suggest one reason improved tax administration was so effective was that it flattened the relationship between firm size and enforcement, removing the additional “enforcement tax” on large firms. On net, our results suggest that improving tax administration can have significant returns for developing country governments.

URLhttps://www.hks.harvard.edu/centers/cid/publications/faculty-working-papers/corporate-taxation-indonesia
来源智库Center for International Development (United States)
资源类型智库出版物
条目标识符http://119.78.100.153/handle/2XGU8XDN/503286
推荐引用方式
GB/T 7714
M. Chatib Basri,Mayara Felix,Rema Hanna,et al. Tax Administration vs Tax Rates: Evidence from Corporate Taxation in Indonesia. 2019.
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