Volume 31, Issue 58 (2023)
J Tax Res 2023, 31(58): 48-74 |
Back to browse issues page
Download citation:
BibTeX | RIS | EndNote | Medlars | ProCite | Reference Manager | RefWorks
Send citation to:
BibTeX | RIS | EndNote | Medlars | ProCite | Reference Manager | RefWorks
Send citation to:
Farajzadeh Z, Nazari M. The Consequences of Agricultural Tax. J Tax Res 2023; 31 (58) :48-74
URL: http://taxjournal.ir/article-1-2297-en.html
URL: http://taxjournal.ir/article-1-2297-en.html
1- , zakariafarajzadeh@gmail.com
Abstract: (1266 Views)
The objective of this study is to examine the effect of imposing agricultural tax on macroeconomic variables, sectoral output and households’ welfare. To get the objective, a Social Accounting Matrix based CGE model was applied. The findings showed that imposing tax rate of 20% on agricultural land and natural resources will increase government tax revenues by more than 5 percent; however it has a negligible effect on other variables. As for value added (output) tax, a 15% tax will result in 15% (more than 20%) increase in government tax revenues while it induces a reduction in GDP by less than 2% (more than 3.2%) as well as prices increase by 3.2% (around 4%). However, 15% value added tax is expected to reduce output in some agricultural activities by more than 10% as well as by less than 3% in no-agricultural sectors. The same pattern of output changes is expected to be realized for output tax scenario. The rural households’ welfare will decrease by more than 4% under land and agricultural natural resources tax of 15% while those of the urban households tend to increase slightly. The corresponding values for 15% value added tax in rural and urban areas are 7-9% and 4-5% welfare reduction, respectively. Imposing this tax rate on agricultural output will lower the rural households’ welfare by 10-12% while the corresponding range for urban households is half of the rural households’ one.
Type of Study: Research |
Subject:
Management
Received: 2023/10/24 | Accepted: 2023/09/1 | Published: 2023/09/1
Received: 2023/10/24 | Accepted: 2023/09/1 | Published: 2023/09/1
References
1. Arshadhi, A. Najafizadeh, S. A. and Mahdavi, M. (1390). The Effect of Value Added Tax on Prices in Iran. Economic Research and Policy Quarterly, 58, 127-158, (Persian).
2. Mr. A. M. and Kamijani, A. (1380). Theoretical Foundations of Value Added Tax and its Advantages in the Direction of Reforming the Tax System. Economic Research Journal, 1(2), 135-158, (Persian).
3. Central Bank of Iran (1400). Sarzamani Information Bank. http: // https: //tsd. cbi. ir/Display/Content. Aspx, (Persian).
4. Pejuyan, J. and Darvishi, b. (1389). Structural Reforms in Iran's Fiscal System. Tax, 18, (8 (serial) 56), 9-47, (Persian).
5. Panahi, M. Q. Tahmasabi Beldaji, F. and Nekoamal Kermani, M. (1390). Practical Guide of Value Added Tax and Legal Obligations of Taxpayers. Organization of Tax Affairs, Value Added Tax Planning Office, Tehran, (Persian).
6. Pirai, Kh. and Farhanian, S. M. J. (1383). The Minimum Rate of Value Added Tax Applicable in Iran. Journal of Economic Research, 66, 270-237, (Persian).
7. Jafari Samimi, A. and Hassanzadeh Jazdani, A. R. (1380). The Effect of Taxes on Economic Growth: A Review of Theoretical and Empirical Analysis. Iranian Economic Research Quarterly, 1(2), 41-67, (Persian).
8. Haj Amini, M. Ahmadishadmehri, M. i. Falahi, M. A. and Najimidani, A. A. (2015). Investigating the Effect of Budget Deficit and Inflationary Tax on Demand Side Components in Iran's Economy. Economic Research Quarterly (Sustainable Growth and Development), 16(4), 57-84, (Persian).
9. Petitioner, H. Bakhshi Dastjerdi, R. and Maruti Sharifabadi, A. (2013). Modeling the Dynamic System of Land Value Tax in Iran's Economy. Economic Research, 49(3), 499-521, (Persian).
10. Rozbeh, F. fur embroidery, b. Sultan Panah, H. Hosni, K. and Taherkhoiani, K. (2013). Investigating the Effects of Value-added Tax Implementation on Inflation in Iran's Economy in 2089. Economic Research (Sustainable Growth and Development). (3) 14, 119-93, (Persian).
11. Sharifi, N. (1390). Effects of Indirect Taxes and Government Spending on Employment and Inflation: a Data-output Analysis. Economic Research, 46(95), 59-78, (Persian).
12. Sadeghi, b. Ahmadpourbarazjani, M. and Dianti, M. (2016). The Effect of Inflation Tax on the Growth of Iran's Agricultural Sector. Agricultural Economics and Development, 99, 1-16, (Persian).
13. Sadeghi, M. and Fadai Khorasgani, M. (1381). Investigating the Inflationary Effects of Value-added Tax on Different Sectors of Iran's Economy (Data-result Analysis). Iranian Economic Research Quarterly, 2(4), 63-90, (Persian).
14. Erfani, A. R. Rezaei, M. Q. and Eskandari, M. (2015). The Impact of Inflation Targeting on Tax Revenues: a Cross-country Analysis. Tax Research Journal, 78, 213-241, (Persian).
15. Farajzadeh, Z. (2011). Environmental and Welfare Effects of Reforming Commercial and Energy Policies in Iran. PhD Thesis in Agricultural Economics, Shiraz University, Shiraz, (Persian).
16. Faridzad, A. Parvin, S. and Banouyi, A. A. (1390). The Price Effects of Taxes on Value added using the Data-receipt Technique (Case of Iran). Iranian Economic Research Quarterly, 47, 105-127, (Persian).
17. Gilak Hakimabadi, M. T. (1383). Lessons from the Process of Tax Reforms in the World: A Case Study of Iran. Journal of Humanities and Social Sciences, 4, (13 (Special Economics)): 158-129, (Persian).
18. Mobini, M. Memarzadeh, Tehran, Gha. R. and Ebrahimzadeh, A. (2015). Identifying Obstacles and Promoters of VAT Establishment. Development and Transformation Management Journal, 24, 23-32.
19. Mujtahid, A. and Ahmadian, A. (1386). The Effect of Government Tax Revenues on Iran's Social Welfare. Economic Research Journal, (Special Tax Issue), 71-45, (Persian).
20. Beghin, J., Dessus, S., Ronald-Holst, D. and Mensbrugghe, V.D. (2002). Empirical Modeling of Trade and Environment. Trade and Environment in General Equilibrium: Evidence from Developing Economics, Chapter 3. Berlin. Springer. [DOI:10.1007/0-306-47672-X]
21. Caminal, R. (2012). Taxation of Banks: A Theoretical Framework. Institutd Analist Economica, CSIC.
22. Christandl. F., Detlef, F. and Hoelzl, E. (2011). Price Perception and Confirmation Bias in the Context of a VAT Increase. Journal of Economic Psychology, 32(1), 131-141. [DOI:10.1016/j.joep.2010.09.006]
23. Claus, I. (2013). Is the Value Added Tax a Useful Macroeconomic Stabilization Instrument?. Economic Modelling, 30, 366-374. [DOI:10.1016/j.econmod.2012.08.025]
24. Cooley, T.F. and Hansen, G.D. (1991). The Welfare Costs of Moderate Inflations. Journal of Money, Credit and Banking, 23(3), 483-503. [DOI:10.2307/1992683]
25. Dalic, M. (1997). Price Effects of VAT Introduction in Croatia. Economic Trends and Economic Policy, 53, 17-43. [DOI:10.3326/ops.4]
26. de Melo, J. and Tarr, D. (1992). A General Equilibrium Analysis of US Foreign Trade Policy. MIT Press, Cambridge MA.
27. Easterly, W. and Rebelo, S. (1993). Marginal Income Tax Rates and Economic Growth in Developing Countries. European Economic Review, 37, 409-417. [DOI:10.1016/0014-2921(93)90029-A]
28. Engen, E.M. and Skinner, J. (1992). Fiscal Policy and Economic Growth. NBER Working Paper No. 4223. [DOI:10.3386/w4223]
29. Farajzadeh, Z. (2018). Emissions Tax in Iran: Incorporating Pollution Disutility in a Welfare Analysis. Journal of Cleaner Production, 186, 618-631. [DOI:10.1016/j.jclepro.2018.03.093]
30. Farajzadeh, Z., Zhu, X. and Bakhshoodeh, M. (2017). Trade Reform in Iran for Accession to the World Trade Organization: Analysis of Welfare and Environmental Impacts. Economic Modelling, 63, 75-85. [DOI:10.1016/j.econmod.2017.02.006]
31. Ferriera, P.C. (2005). Welfare and Growth Effects of Alternative Fiscal Rules for Infrastructure Investment in Brazil. Ensaios Economicos da EPGE 604. EPGE- FGV Output Novembro 2005.
32. Food and Agriculture Organization. (2010). Statistical Database, http://www.fao.org.
33. Geurts, B., Gielen, A., Nahuis, R., Tang, P. and Timmer, H. (1997). Scanning World Scan; Final Report on the Presentation and Evaluation of World Scan, a Model of the World Economy for Scenario Analysis, Global Change Series. Dutch National Research Program on Global Air Pollution and Climate Change, Report No. 410 200 008, CPB Netherlands Bureau for Economic Policy Analysis, The Hague.
34. Hosoe, N. (2001). A General Equilibrium Analysis of Jordan's Trade Liberalization. Journal of Policy Modeling, 23, 595-600. [DOI:10.1016/S0161-8938(01)00060-6]
35. Jensen, J. and Tarr, T. (2003). Trade, Exchange Rate, and Energy Pricing Reform in Iran: Potentially Large Efficiency Effects and Gains to the Poor. Review of Development Economics, 7(4), 543-562. [DOI:10.1111/1467-9361.00208]
36. Keen, M. and Lockwood, B. (2010). The Value Added Tax: Its Causes and Consequences. Journal of Development Economics, 92, 138-151. [DOI:10.1016/j.jdeveco.2009.01.012]
37. Markusen, J.R. (2002). MPSGE: A User's Guide. Department of Economics, University of Colorado, Boulder.
38. McDonald, S., Thierfelder, K. and Robinson, S. (2007). Globe: A SAM Based Global CGE Model Using GTAP Data. Available at http://econpapers.repec.org/paper/usnusnawp/14.htm.
39. Meyer, B.D. and Rosenboum, D.T. (2000). Making Single Mothers Work: Recent Tax And Welfare Policy And its Effects. National Bureau of Economic Research, Working Paper, No. 7491. [DOI:10.3386/w7491]
40. Moore, D.S. (2005). Tax and Welfare Reforms. International Monetary Fund, W/5/133. [DOI:10.5089/9781451861525.001]
41. Rutherford T. F. (1987). Applied General Equilibrium Modeling, PhD Thesis, Stanford University.
42. Sajadifar, S.H., Khiabani, N. and Arakelyan, A. (2012). Computable General Equilibrium Model for Evaluating the Effects of Value-added Tax Reform in Iran. World Applied Sciences Journal, 18 (7), 918-924.
43. Tait, A.A. (1988). Value Added Tax: International Practice and Problems. International Monetary Fund.
44. Tideman, N. (2004). The Case for Taxing Land. Retrieved from http: //www.Wealthandwant.com/docs/tideman_CTI.html.
45. UN Statistical Databases. (2010). http://data.un.org.
46. World Bank (2016). World Development Indicators. http://data.worldbank.org/data-catalog/world-development-indicators.
Send email to the article author
| Rights and permissions | |
 |
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License. |
