TAX SMOOTHING: TESTS ON INDONESIAN DATA

Rudi KURNİAWAN

Makale detayları

TAX SMOOTHING: TESTS ON INDONESIAN DATA

Yazarlar:

Rudi KURNİAWAN

Yayıncı:

Sosyal Bilimler Araştırmaları Derneği

Dergi:

International Journal of Economics and Finance Studies 2011 Vol.3 Issue 1, pp.187-197

Belge Tipi:

Makale

Yayın Tarihi:

5/2011

Belge Dili:

Türkçe

Document ID (Org No.):

2000811256

Sıklık:

İki Yıllık

eISSN:

1309-8055

Özet:

 

This paper contributes to the literature of public debt management by testing for  tax smoothing behaviour in Indonesia. Tax smoothing means that the government  smooths the tax rate across all future time periods to minimize the distortionary  costs of taxation over time for a given path of government spending. In a  stochastic economy with an incomplete bond market, tax smoothing implies that  the tax rate approximates a random walk and changes in the tax rate are nearly  unpredictable. For that purpose, two tests were performed. First, random walk  behaviour of the tax rate was examined by undertaking unit root tests. The null  hypothesis of unit root cannot be rejected, indicating that the tax rate is  nonstationary and, hence, it follows a random walk. Second, the predictability of  the tax rate was examined by regressing changes in the tax rate on its own lagged  values and also on lagged values of changes in the goverment expenditure ratio,  and growth of real output. They are found to be not significant in predicting  changes in the tax rate. Taken together, the present evidence seems to be  consistent with the tax smoothing, therefore provides support to this theory.

Makale detayları

TAX SMOOTHING: TESTS ON INDONESIAN DATA

Yazarlar: Rudi KURNİAWAN

Yayıncı: Sosyal Bilimler Araştırmaları Derneği

Dergi: International Journal of Economics and Finance Studies 2011 Vol.3 Issue 1, pp.187-197

Belge Tipi: Makale

Yayın Tarihi: 5/2011

Belge Dili: Türkçe

Document ID (Org No.): 2000811256

Sıklık: İki Yıllık

eISSN: 1309-8055

Sayı

Yazarlar:

Rudi KURNİAWAN

Yayıncı:

Sosyal Bilimler Araştırmaları Derneği

Dergi:

International Journal of Economics and Finance Studies 2011 Vol.3 Issue 1, pp.187-197

Belge Tipi:

Makale

Yayın Tarihi:

5/2011

Belge Dili:

Türkçe

Document ID (Org No.):

2000811256

Sıklık:

İki Yıllık

eISSN:

1309-8055