Beruflich Dokumente
Kultur Dokumente
10(3)/2015
DOI 10.1515/sbe-2015-0032
Abstract:
The characteristics of fiscal revenues are the ones that demonstrate their importance
for the formation of public financial resources, being considered as a product of historical
development of the state. Numerous studies and researches on the taxes action in financial,
economic and social level emphasized the link between fiscal policy, growth and level of
development of a country. In this context, through this article, by presenting some general
coordinates of taxation in countries of Central, Eastern and Southeast Europe (CESEE
countries) we will identify the similarities and differences concerning the taxation system and the
impact of taxation on the socio-economic development. Without claiming an exhaustive
approach, we consider that issues outlined highlight in which country taxation is a stimulating
factor for economic growth and development, so that good practice be elements worthy of
consideration.
Key words: tax burden, fiscal freedom, direct taxation, indirect taxation
1. Introduction
The requirements that any reasonable tax system must comply are found in
the principles of taxation, according to which it can set up a real partnership between
the state and taxpayers. To the extent that clarity, development, equity, efficiency,
effectiveness, ethics, non-discrimination, neutrality, optimization, rationality, relevance
and simplicity are found as the main keyword of fiscal policy at the level of any state,
the aim and role of taxation will be felt at financial, economic and social level, thus
contributing significantly to economic growth and development.
The analysis of taxation area from the CESEE countries is reflected in many
studies and research from specialized literature, having regard to the significant
changes in these countries, both in economic and social plan, as well as in political
plan. It is noted as follows: the presentation of recent developments and forecasts
- 10.1515/sbe-2015-0032
- 16 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
- 10.1515/sbe-2015-0032
- 17 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
30
28
26
24
Global average
22
EU average
Europe average
20
18
16
CESEE average
14
12
10
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2015
- 10.1515/sbe-2015-0032
- 18 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
15
18
10
10
20
19
20
19
10
15
15
10
MDA
MNE
POL
ROU
RUS
SRB
SVK
SVN
TUR
UKR
15
0
0
0
0
0
12
12
9
9
9
9
9
9
9
9
19
19
19
19
19
19
19
19
16
16
16
16
16
16
16
16
24
24
24
20
20
20
20
20
10
10
10
10
10
10
10
15
19
19
19
19
19
19
19
23
25
23
22
21
20
20
18
17
20
20
20
20
20
20
20
20
25
25
25
25
25
25
21
19
(Source: author processing based on data from KPMG,
Kosovo-Law on corporate income tax, Moldova-Fiscal Code)
12
9
19
16
20
15
22
17
20
18
12
9
19
16
20
15
22
17
20
18
In many CESEE countries, along with standard corporate tax rate are found
tax systems that involve reduced rates, taking into account the activity domain, the
typology of companies, the area where the companies operate, the investment regime.
In this respect, we note the following (KPMG, 2015a): in Belarus it applies
reduced rates of taxation for activities in the field of high technologies (10%), for
residents of free economic zones (9%) and for members of Science and Technology
Association established by the State University (5%); in Croatia, under special
schemes to boost investment, companies benefit of a total exemption from corporate
tax or a reduction the tax rate to 50% or 70% for a period of up to 10 years and until 31
December 2016 companies registered in tax-free zones benefit of a decrease by 25%
of the tax rates; in Czech Republic it applies special tax rates for profit funds,
respectively 5% where at least 90% of the funds property is invested in investment
securities and 0% to pension funds; Hungary applies a progressive corporate tax
system, respectively a tax rate of 10% for taxable income up to HUF 500 million
(approximately USD 1,800,000) and a tax rate of 19% for taxable income exceeding
HUF 500 million; in Latvia, the companies operating in the four regions named Special
Economic Zones benefit from a reduction of corporation tax of 80% and the very small
companies with an annual turnover less than EUR 100,000 may opt for a tax system
related to the turnover in rate of 11%; in Lithuania is practiced a tax rate of 5% for
agricultural companies and small companies having average number of employees up
to 10 and an income up to LTL 1,000,000 (EUR 289,620) and a tax rate of 0% for
social companies and companies established in free economic zones; in Macedonia
are exempt from taxation the companies investing in technological industrial zones for
a period of 10 years; in Romania, alongside the standard corporate tax rate of 16% can
be found the fiscal regime for micro enterprises, respectively 3% on the income
received and fiscal regime for taxpayers involved in activities related to nightclubs,
casinos and discotheques who are obliged to pay a tax of 5% of the revenues derived
from those activities, in the case of the relevant profit tax is lower than 5% of the
revenues derived from those activities; in Ukraine, for income obtained by the
companies from longterm life insurance, private medical and pension insurance it
- 10.1515/sbe-2015-0032
- 19 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
- 10.1515/sbe-2015-0032
- 20 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
45
EU average
40
Europe average
35
30
Global average
25
20
15
CESEE average
10
5
0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
100%
80%
60%
40%
20%
0%
2006
2007
2008
2009
2010
flat rate
2011
2012
2012
2013
2014
2015
progressive rate
- 10.1515/sbe-2015-0032
- 21 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
- 10.1515/sbe-2015-0032
- 23 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
25
22
19
16
13
10
2006
2007
2008
2009
Europe average
2010
2011
EU average
2012
2013
Global average
2014
2015
CESEE average
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
20
18
17
20
22
19
18
20
15
18
18
18
20
17
22
20
18
17
20
22
19
18
20
15
18
18
18
20
17
22
20
18
17
20
22
19
18
20
15
18
18
18
20
17
22
20
18
17
20
22
19
18
20
16
21
19
18
20
17
22
20
20
17
20
23
20
20
25
16
21
21
18
20
17
22
20
20
17
20
23
20
20
25
16
22
21
18
20
17
23
20
20
17
20
25
20
20
27
16
21
21
18
20
17
23
20
20
17
20
25
21
20
27
16
21
21
18
20
19
23
20
20
17
20
25
21
20
27
16
21
21
18
20
19
23
20
20
17
20
25
21
20
27
18
21
21
18
20
19
23
- 10.1515/sbe-2015-0032
- 24 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
60
200
180
160
140
120
100
80
60
40
20
0
50
40
30
20
10
0
UK R
TUR
SVN
SVK
S RB
RUS
ROU
POL
M NE
M DA
MKD
LT U
LV A
UV K
HUN
EST
CZE
CRO
BGR
B iH
B LR
A LB
World Rank
- 10.1515/sbe-2015-0032
- 26 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
ALB
UKR 100
TUR
BLR
BiH
80
SVN
BGR
60
SVK
CRO
40
20
SRB
CZE
RUS
EST
HUN
ROU
POL
UVK
MNE
LVA
MDA
LTU
MKD
Fiscal freedom
Fig. no. 6 Index of Economic freedom (overall score) and Fiscal freedom
from CESEE countries in 2015
(Source: Heritage Foundation, 2015 Index of Economic Freedom)
From the perspective of the fiscal freedom index (Heritage Foundation, 2015),
the situation is totally changed, as can be seen from Fig. no. 6, so that: most countries
(72.72%) are in the free area, with the highest value in Albania (87.2); Croatia,
Hungary, Turkey and Ukraine are in the mostly free area; Slovenia is in the mostly unfree area; Kosovo is not included in the rankings.
5. Conclusions
Based on the data presented above and in close correlation with the main
macroeconomic indicators, we believe that fiscal decisions in CESEE countries should
consider improving the growth rate of GDP, reducing unemployment, reduction of
inflation and increasing the volume of foreign direct investment. The direct link between
tax indicators and the main indicators of economic growth (World Bank, 2015) can be
seen from Tab. no. 4.
Tab. no. 4 The highest level and the lowest level of the macroeconomic
indicators from CESEE countries
Indicators
Highest level
Lowest level
Hungary
51,1 % Poland
16,8%
Taxes and
other revenues Bosnia and
Russia
45,7%
20,2%
as
Herzegovina
- 10.1515/sbe-2015-0032
- 27 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
% of GDP
(2014)
Top marginal
corporate tax
rate (2015)
Top marginal
personal
income tax rate
(2015)
The standard
VAT rate (2015)
GDP growthannual %
(2014)
Unemployment,
total - % of total
labor force
(2013)
Czech Republic
41,0%
Slovak Republic
Croatia, Estonia,
Russia, Turkey
22%
20%
Czech Republic,
Hungary, Poland
Slovenia
Croatia
19%
50%
40%
Turkey
Hungary
35%
27%
Croatia
25%
Romania
Bosnia and
Herzegovina
Czech Republic
Turkey
Kosovo
Macedonia
Bosnia and
Herzegovina
Ukraine
Turkey
24%
4,4%
4,3%
3,8%
35,3%
29,0%
28,4%
Turkey
Montenegro
Bosnia and
Herzegovina,
Bulgaria, Kosovo,
Macedonia
Moldova
Montenegro
Bosnia and
Herzegovina,
Bulgaria, Kosovo,
Macedonia
Belarus, Russia
Bosnia and
Herzegovina
Kosovo, Macedonia,
Russia, Turkey
Montenegro
Ukraine
Belarus
Russia
Moldova
Russia
Belarus
23,3%
9%
10%
12%
9%
10%
13%
17%
18%
19%
-14,6%
-4,4%
-4,1%
5,1%
5,6%
5,8%
12,2% Montenegro
-0,7%
Inflation,
8,9%
Bosnia and
-0,9%
consumer
Herzegovina
prices - annual
% (2014)
Russia
7,8%
Bulgaria
-1,4%
(Source: author processing based on data from KPMG, Trading Economics, Eurofast,
World Factbook, Tax Administration of Kosovo, Fiscal Code of Moldova, and World
Bank)
Evolution of macroeconomic indicators from CESEE countries highlight the link
between taxation and economic growth, link proven by the specialized literature,
namely: within a framework of endogenous growth, it is considered that inflation is a
problem of public finances, respectively an inefficient tax system causes a high rate of
inflation (De Gregorio, 1993); non-distortionary taxation and productive expenditures
positively influence the economic growth (Kneller, Bleaney and Gemmell, 1999);
- 10.1515/sbe-2015-0032
- 28 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
- 10.1515/sbe-2015-0032
- 29 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
- 10.1515/sbe-2015-0032
- 30 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access
- 10.1515/sbe-2015-0032
- 31 Downloaded from De Gruyter Online at 09/28/2016 03:38:14PM
via free access