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on Confederation of Independent States |
| By: | Alexander Libman (University of Mannheim); Lars P. Feld (University of Heidelberg) |
| Abstract: | In a centralized federation, where tax rates and taxation rules are set by the federal government, manipulating the thoroughness of tax auditing and the effectiveness of tax collection could be attractive for regional authorities because of a variety of reasons. These range from tax competition to principal-agent problems, state capture and benefits of fiscal equalization. In this paper we discuss strategic tax auditing and collection from the perspective of fiscal federalism and test for strategic tax collection empirically using data of the Russian Federation. Russia’s regional authorities in the 1990s have always been suspect of tax auditing manipulations in their favor. However, in the 2000s increasing bargaining po¬wer of the centre seems to induce tax collection bodies in the regions to manipulate tax auditing in favor of the federal centre. Our findings confirm the existence of strategic tax collection for the Yeltsin period after exclusion of outliers; the results for the Putin period are however rather ambiguous. |
| Keywords: | fiscal federalism, tax arrears, transition economies |
| JEL: | H26 H77 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:2009/10/doc2009-11&r=cis |
| By: | Leppänen, Simo (BOFIT); Solanko, Laura (BOFIT); Linden, Mikael (BOFIT) |
| Abstract: | Enterprises in post-socialist and transition economies often participate in providing infrastructure and social services to the surrounding community. We argue that this bundling of social and infrastructure goods provision with an enterprise’s core operations is a fully rational choice in an uncertain environment. Using a stylized model, we show that this activity can be largely related to efforts by firms to increase their operational reliability. Our unique survey data suggest that this manifests itself through provision of more reliable infrastructure, stronger employee attachment to the firm, and better relations with the authorities. |
| Keywords: | uncertainty; enterprise performance; Russia |
| JEL: | P30 |
| Date: | 2009–10–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bofitp:2009_016&r=cis |