Essays in Taxation Policy

This thesis studies various aspects of taxation policy covering several essential dimensions such as welfare, politics and tax compliance. The first chapter examines the taxation of financial institutions, the second chapter studies some political aspects of tax policy and the last chapter analyses the effectiveness of a popular tax administration policy in a developing country context. Following the recent financial crisis, there has been considerable policy discussion regarding the taxation of financial institutions. While not front and centre in the public discourse, amongst tax policy experts the VAT treatment of financial institutions has been proven to be very contentious. The first chapter examines the welfare and revenue consequences of a widely practiced VAT policy for financial institutions: exempt treatment. We show that shifting the VAT from exempt treatment to the theoretical ideal of full taxation (the way regular businesses are taxed) is welfare improving and tax revenue increasing. In the second chapter, we study the politics of capital taxation within the context of policy instability and infrastructure investment. Many developing countries rely on private investors to improve their infrastructure. Yet, investors face the risk of opportunistic (tax) policy revisions by the host government, which may adversely impact their return. The results show that countries with high political constraints (and hence, with more policy stability) attract more investment and the magnitude of the impact is larger in the long-run. The final chapter empirically evaluates a new technology for filing tax returns: online filing (e-filing). E-filing has been widely practiced in developed countries for years and it has been argued that it simplifies the procedure and saves time and money for taxpayers. However, it is not self-evident that this should always be the case, especially in developing countries. We find that the effectiveness of the policy depends largely on policy implementation, firm experience with the policy and the infrastructure environment in the country.

Name thesis:degree_name

Doctor of Philosophy (PhD)

Discipline thesis:degree_discipline

Economics

Grantor dc:publisher.institution

Graduate Studies

Year dc:date.issued

2014

Author dc:creator

• Yilmaz, Fatih

Advisors dc:contributor.advisor

• McKenzie, Kenneth J.
• Wen, Jean-Francois
• Herbert, Emery

• Economics
• Economics--Finance
• Economics--Theory

Statement dc:rights

• University of Calgary graduate students retain copyright ownership and moral rights for their thesis. You may use this material in any way that is permitted by the Copyright Act or through licensing that has been assigned to the document. For uses that are not allowable under copyright legislation or licensing, you are required to seek permission.

Language dc:language.iso

eng

DOI

http://dx.doi.org/10.11575/PRISM/25939

OAI identifier oai:identifier

oai:ucalgary.scholaris.ca:11023/1584