Search Results (15)

This study aims to examine the impact of taxation on the adoption of digital finance in Africa and to assess the extent to which governance quality moderates this relationship. Using panel data for 54 African countries over the period 2007–2023 and applying the two-step System GMM, we find that taxes on goods and services—especially excise duties—exert a positive and statistically significant effect on the share of the population adopting mobile money. More importantly, this positive effect is strongly amplified in countries with better governance quality. Interaction terms reveal that government effectiveness, control of corruption, and voice and accountability significantly moderate the tax-adoption nexus, making taxation more conducive to digital finance development in countries with stronger institutions. These results remain robust across alternative tax measures, sample restrictions, lag structures, and additional controls. By distinguishing between general tax capacity and sector-specific taxes on digital financial services, this study reconciles contrasting findings in the literature and highlights a complementary relationship between fiscal policy and institutional quality. The findings suggest that strengthening governance represents a more effective strategy for simultaneously expanding the tax base and promoting digital financial inclusion in Africa. Full article

Thailand’s 2024 excise tax reform aimed to stimulate the tourism economy through the elimination of import tariffs and the reduction in excise rates on wine. This study evaluates the causal economic and distributional impacts of this policy intervention. The analysis employs a quasi-experimental Doubly Robust Difference-in-Differences (DR-DiD) estimator on a stratified cluster sample to isolate shifts in consumption expenditure, volume, and net ethanol intake. Results indicate a null effect for the general population, which confirms that the price floor remained prohibitive for median earners despite the tax reduction. The top income quintile conversely exhibited a statistically significant “additive premiumization” effect characterized by a surge in wine quantity without the substitution of other beverage categories. This behavioral shift generated a substantial Net Economic Loss driven by the divergence between foregone tax revenue and projected human capital productivity losses. The policy consequently functioned as a regressive fiscal transfer to the elite and created severe allocative inefficiency. These findings suggest that ad valorem tax incentives for luxury goods in emerging markets generate deadweight loss. Future policy strategies should therefore prioritize specific volumetric taxation to align fiscal incentives with public health objectives. Full article

Fuels constitute one of the most strategically significant categories of goods in the global economy. In many countries, including Poland, fuel prices are determined not only by global market dynamics but also by domestic fiscal instruments such as excise taxes, value-added tax (VAT), and fuel surcharges. The primary objective of this study is therefore to assess the extent to which tax burdens and profit margins shape diesel prices in Poland, thereby providing a deeper understanding of the market’s sensitivity to fiscal interventions and the pricing strategies adopted by fuel companies. The analysis draws on weekly data for the period 2006–2025, encompassing crude oil prices, wholesale and retail diesel prices, and relevant tax components (VAT, excise tax, and fuel surcharges). Methodologically, the study employs the Bai–Perron breakpoint test alongside correlation and comparative methods. The findings indicate that changes in indirect taxation and the fuel surcharge in Poland were predominantly upward and incremental, exerting only limited immediate effects on wholesale and retail fuel prices. This pattern was particularly evident outside of periods of acute geopolitical shocks, such as the 2022 war in Ukraine, when government interventions aimed to mitigate sudden price surges. Moreover, analysis of PKN Orlen’s margin dynamics shows that the company remained consistently profitable, with the highest processing margins observed following the reduction of the VAT rate, highlighting the interplay between fiscal policy and corporate pricing behavior. An exception occurred in 2022, when political involvement led to negative retail margins despite a reduction in VAT, a policy decision intended to mitigate sharp increases in fuel prices. The evidence suggests that petrochemical companies have greater capacity to affect prices through adjustments to wholesale margins than to retail margins. The study also underscores the critical role of fiscal policy in protecting households from fuel price volatility. It also demonstrates that carefully designed adjustments to taxation and other fiscal instruments can meaningfully influence market outcomes and corporate profitability, thereby highlighting their importance in broader economic stabilization efforts. Full article

In this work, reduction of alcoholic strength was discussed as a means to reduce consumption and alcohol-attributable harm. Statistical modelling was conducted to (1) estimate its potential for the largest six Western and Central European countries (France, Germany, Italy, Poland, Spain, UK); (2) calculate the increase in taxation necessary to reach this potential, and (3) estimate the mortality gains achieved with the introduction of no- or low-alcohol beverages in the UK and Spain. The high public health potential of reducing alcoholic strength was demonstrated via modelling a scenario in which the strength of all beverages was reduced by 10%, which would avert thousands of deaths in these six European countries per year. However, methods by which to achieve these gains were not clear, as the alcohol industry has shown no inclination toward reductions in the alcoholic strength of beer, wine, or spirits via a reformulation on a large scale. The increase of excise taxation to achieve the public health gains of such a reduction would result in markedly increasing prices—a situation unlikely to be implemented in Europe. Finally, the introduction of beer and wine with an alcoholic strength below 0.5% led to some substitutions of higher-strength beverages, but did not show a marked public health impact. New taxation initiatives to achieve the potential of a reduction of alcoholic strength will need to be implemented. Full article

This article uses the NMNL (nested multinominal logit) model to analyze the impact of different policies on the cost of owning a vehicle by a consumer and discusses the changes in the share of various fuel-driven types of passenger vehicles that may be brought by different policy portfolios. This article also considers the differences in the development of various technical routes, conducts the nested classification calculation of different models, divides the differences in product preferences and obtains the market share results that are more in line with the market development status, providing a basis for the formulation of policies related to new energy vehicles. The study found that the popularization of NEVs requires more cost-reducing measures. As policies that consumers can perceive, consumers are more sensitive to fiscal and taxation policies than other types of policies. Based on the calculation of policy effects, this article recommends a policy plan to gradually impose vehicle purchase tax on NEVs after 2024, increase the fuel tax rate in stages after 2025, and impose an excise tax on BEVs and FCEVs after 2030. The plan can guarantee the stability of support for NEVs and the gradual reduction of financial investment. Full article

Taxation exerts pressure on the economic activities of all companies, including economic entities that operate in the energy industry. This study examined the degree to which fiscal pressure influenced the financial performance of 88 publicly listed companies from the energy industry during a time frame of 16 years (2005Q1–2020Q3). By modelling financial data from the oil, gas and electricity sectors with panel data techniques, our results showed that fiscal pressure had a significant effect on the evolution of company financial performance measured by return on assets, return on equity and return on investment. The study revealed that fiscal pressure had a more positive impact on the financial performance of energy companies than a negative impact. This conclusion is important for overall taxation in the energy industry since corporate taxes, excise duties and mandatory labor contributions are basic resources for state budgets. Our empirical results imply important research directions on the prospect of analyzing company performance. Full article

Smoking causes substantial amount of mortality and morbidity. This article presents the findings from simulation models that projected the impact of five potential Tobacco Endgame strategies on smoking prevalence in Ontario by 2035 and expected impact of smoking prevalence “less than 5 by 35” on tax revenue. We used Ontario SimSmoke simulation for modelling the expected impact of four strategies: plain packaging, free cessation services, decreasing the number of tobacco outlets, and increasing tobacco taxes. Separate models were used to project the impact of increasing the minimum age to legally purchase tobacco to 21 years on smoking prevalence and impact of price and tax increase to achieve “less than 5 by 35” on taxation revenue. The combined effect of four strategies in Ontario SimSmoke Model are expected to reduce smoking prevalence by 8.5% in 2035. Increasing tobacco taxes had the greatest independent predicted decrease in smoking prevalence (2.8%) followed by raised minimum age for legal purchase to 21 years (2.4%), decreasing tobacco outlets (1.5%), free cessation services (0.7%), and plain packaging (0.6%). Increasing tobacco excise tax and prices are projected to have minimal impact on taxation revenue, with a decrease from 1.5 billion to 1.2 billion annual tax receipts. Full article

Despite environmental taxation’s presumed advantages for long-term sustainable development goals, the problematic institutional conditions associated with high levels of corruption could become a significant obstacle undermining these efforts. Taking the example of the Czech Republic as a benchmark, the aim of this article is to evaluate the impact of corruption and its implications on the size of the official and the shadow economy in the sector burdened with environmental excise tax while confronting it with the sector not burdened with such tax. In terms of methodology, an extended DSGE (Dynamic stochastic general equilibrium) model has been used. In the case of the shadow economy, the two sectors, burdened and not burdened with environmental taxes, followed a similar trend. However, concerning the official economy, this research found out that if environmental taxation is not applied, then lower, non-systemic corruption has a positive effect on the size of production as the effect of increased workforce motivation clearly dominates, suppressing the effect of reduced capital accumulation. Conversely, in the sector burdened with environmental taxation, corruption has an almost unequivocally negative effect on the production economy. In this sense, corruption has the capacity to limit the implementation of sustainable development policies including the European Green Deal, especially if it is systemic in nature. Full article

The tax structure capable of achieving an energy transition in the power sector was analyzed by applying the Pigouvian tax on generation fuels. Under the 2018 Tax Act Amendment, the tax rate criteria for the excise tax on power generation fuels changed from the calorific value to environmental externalities of the fuel. However, to reverse the merit order of bituminous coal generation with liquefied natural gas (LNG) generation, reflecting only some external costs of the environment as a tax is not enough. In this paper, we established four tax reform scenarios for bituminous coal and LNG considering environmental externalities, and we analyzed the reversal of dispatch priority using the electricity system unit commitment and M-Core economic dispatch model. According to the analysis results, the share of bituminous coal generation will be reduced to 10–20% depending on the scenario, reflecting the relative tax rate equalizing the fuel costs of bituminous coal and LNG power. To achieve an energy transition by reversing the merit order of bituminous coal and LNG generation, the tax rate of bituminous coal must be more than twice that of LNG. Moreover, to achieve an eco-friendly generation mix through tax reform, the external costs of the environment by fuel source should be accurately estimated and efficient taxation that can adequately reflect these external costs of the environment while considering tax fairness, neutrality and simplicity should be established. Full article

This research tests the consequences of Nigeria’s indirect taxes on consumption. There are two reasons why the government imposes taxes on goods and services in Nigeria. The primary purpose is to produce income for the smooth running of the administration. Another silent reason is to discourage the ingestion of prohibited products and services, and that is through customs and excise duties (CED). This study assesses both Value Added Tax (VAT) and CED to determine their effects on consumption using various econometric tools, such as trend analysis, pairwise Granger causality tests, unrestricted co-integration rank test, least squares technique, and data that cover the period from 2005 to 2019. The results indicate that VAT insignificantly but positively influences consumption, while CED has a considerable auspicious influence on use. This result shows that VAT imposition on merchandises and services is discouraging the absorption of specific foodstuffs and services and allowing the operation of informal economic activities to thrive in Nigeria. However, CED charges do not reduce the use of certain illegal products purposely taxed to discourage their consumption. This study recommends a reduction in the prices of food items and services to enable consumers to increase their patronage, while the products that attract CED but are harmful should be banned entirely. Thus, offenders should be allowed to face the wrath of the law. Full article

(1) Background: Many studies have shown that increasing taxation on cigarettes does play a role in tobacco control, but few studies have focused on whether increasing cigarette excise taxes significantly affects alcohol consumption. In this article, we aim to examine the effects of China’s 2015 increase in the cigarette excise tax on residents’ regular drinking behavior. (2) Methods: Using survey data from China Family Panel Studies (CFPS), we performed a panel logit regression analysis to model the relationship between the cigarette excise tax and regular drinking behavior. The Propensity Score Matching with Difference-in-Differences (PSM-DID) approach was adopted to determine the extent to which the cigarette excise tax affected residents’ drinking behavior. To test whether the cigarette excise tax could change regular drinking behavior by decreasing daily smoking quantity, we used an interaction term model. (3) Results: China’s 2015 increase in the cigarette excise tax had a significant negative effect on the probability of regular alcohol consumption among smokers, and the cigarette excise tax worked by reducing the average daily smoking of smokers. We also found that the regular drinking behavior of male smokers was more deeply affected by the increased cigarette excise tax than females. (4) Conclusions: Our research results not only give a deeper understanding of the impact of the cigarette excise tax, but also provide an important reference with which to guide future decisions concerning excise taxes imposed on cigarettes. Full article

Vietnam is faced with the issue of increasing overweight and obesity, particularly among children and adolescents in urban areas. As a result, the government of Vietnam recently introduced a proposal to impose a special consumption tax on sugar-sweetened beverages (SSB) in Vietnam, as the drinks are causing negative health consequences for Vietnamese people. This research is aimed at evaluating the impacts of a 10% special consumption tax on SSB in Vietnam using the Almost Ideal Demand System (AIDS) model. We found that a 10% SSB tax will reduce SSB consumption by 11.4%. Consumers will switch to substitutes, leading to an increase in the consumption of milk by 2.3%, beer by 2.5%, dried tea by 2.2%, and wine by 1.7%. However, in the short run, the tax could lead to a decrease in consumer welfare due to higher SSB prices. In addition to people from better-off households, people from the ethnic majority group, most of which live in urban areas with a large number of children, have a relatively high welfare reduction. Full article

The objective of this study was to estimate the sensitivity of spirit quantity demanded for price and income changes in Montenegro and to show the effectiveness of taxation-policy changes in the reduction of spirit consumption. It is the first study on this topic in Montenegro, where adverse effects of alcohol are recognized as an important obstacle in achieving Sustainable Development Goals (SDGs). The price elasticity of spirits was estimated using Deaton’s methodology on the Household Budget Survey (HBS) data in the period of 2006–2017. Cigarettes were included as a control variable as, along with spirits, they are one of the most harmful substances used in Montenegro. Using these results, we simulated the effects of spirit use on public revenue. The results show that the spirits’ own price elasticity equaled −0.45, while the cross-price elasticity equaled −0.17, showing that spirits and cigarettes are complementary goods. These results, along with elasticities calculated by sex (male, −0.55; female, −0.5), income groups (low income, −1.16; middle-income, −0.46; high-income, −0.26), and for the working-age group (−0.74), demonstrate that an increase in excise taxes could be a very efficient tool in decreasing the adverse effect of spirits and cigarettes on household member’s productivity, health, and budget, which is in line with SDGs. An efficient road map for sustainable development for Montenegro must include the reduction of health-harmful substance use through excise tax increase. Full article

Although increasing taxes has been established as the most effective tobacco control policy, it is not clear whether these policies reduce cigarette consumption equally among women and men. In this study, we examine whether the association between taxation/taxation structure and cigarette consumption differs by gender. The data is from the International Tobacco Control Policy Evaluation (ITC) Projects in 17 countries. Cigarette consumption was measured by gender for each ITC country. Generalized estimating equations (GEE) were employed to investigate gender differences in the association between cigarette consumption and tax structures, while controlling for time-variant demographic characteristics such as unemployment rates, proportions of adults, and percent of female population. Tiered tax structures are associated with higher cigarette consumption among both males and females. Female smokers are more responsive to an average tax increase than male smokers. Among males, higher ad valorem share in excise taxes is associated with lower cigarette consumption, but it is not the case for females. Females may not be as responsive to the prices raised by ad valorem taxes, despite being responsive to average taxes, suggesting that smokers by gender may face different prices. Full article

The following paper is concerned with the issue of increasing the excise duty on beer and its consequences for consumption of the studied product. The aim is to demonstrate the tax burden in relation to domestic producers and beer consumption in the domestic market. The time period considered is the 16 years from 1999 to 2014. Data on consumption and the evolution of excise duty rates were compared ex post and conclusions were drawn using an analysis of economic indicators. In general, it is the case that, by increasing the rates of the duty, governments expect to see an increase in the income side of the state budget, even though increases in tax lead to reductions in consumption. This is, however, only a short-term effect and, over a longer time frame, such measures have a negative effect not only on consumption, but also on domestic production and on the tax income in the state budget. Full article