Arbeitspapier
How do small firms respond to tax schedule discontinuities? Evidence from South African tax registers
In this paper we study the effects of various tax schedule discontinuities on the behavior of small firms using high-quality and population-wide tax register data from South Africa. We use the bunching method to analyse how these discontinuities affect the firm-size distribution. We first examine how the value-added tax threshold affects the sales distribution of firms. We also study the effects of two separate corporate income tax rate kinks. We find sizable bunching at each of these thresholds. The elasticity estimates for the corporate tax kink points are large, ranging from 0.7 to 1.6, whereas the elasticity of the value added is below 0.1. We find some suggestive evidence that part of the response is driven by tax evasion.
- ISBN
-
978-92-9256-079-9
- Language
-
Englisch
- Bibliographic citation
-
Series: WIDER Working Paper ; No. 2016/36
- Classification
-
Wirtschaft
Taxation and Subsidies: Efficiency; Optimal Taxation
Business Taxes and Subsidies including sales and value-added (VAT)
Fiscal Policies and Behavior of Economic Agents: Firm
Microeconomic Analyses of Economic Development
- Subject
-
developing countries
value-added tax
corporate tax
VAT threshold
corporate tax kink
bunching
small firms
- Event
-
Geistige Schöpfung
- (who)
-
Boonzaaier, Wian
Harju, Jarkko
Matikka, Tuomas
Pirttilä, Jukka
- Event
-
Veröffentlichung
- (who)
-
The United Nations University World Institute for Development Economics Research (UNU-WIDER)
- (where)
-
Helsinki
- (when)
-
2016
- DOI
-
doi:10.35188/UNU-WIDER/2016/079-9
- Handle
- Last update
-
10.03.2025, 11:42 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Boonzaaier, Wian
- Harju, Jarkko
- Matikka, Tuomas
- Pirttilä, Jukka
- The United Nations University World Institute for Development Economics Research (UNU-WIDER)
Time of origin
- 2016
Other Objects (12)
How do Small Firms Respond to Tax Schedule Discontinuities? Evidence from South African Tax Registers
How do small firms respond to tax schedule discontinuities? Evidence from South African tax registers
How Do Firms Respond to Place-Based Tax Incentives?
Do multinational firms respond to personal dividend income tax rates?
Do multinational firms respond to personal dividend income tax rates?
Tax planning and tax uncertainty for multinational firms
Tax evasion by firms
Firms as tax collectors
Labor earnings respond differently to income-tax and to payroll-tax reforms
Labor Earnings Respond Differently to Income-Tax and to Payroll-Tax Reforms
Corporate tax competition between firms
Does labor supply respond to a flat tax? Evidence from the Russian tax reform
How do Small Firms Respond to Tax Schedule Discontinuities? Evidence from South African Tax Registers
How do small firms respond to tax schedule discontinuities? Evidence from South African tax registers
How Do Firms Respond to Place-Based Tax Incentives?
Do multinational firms respond to personal dividend income tax rates?
Do multinational firms respond to personal dividend income tax rates?
Tax planning and tax uncertainty for multinational firms
Tax evasion by firms
Firms as tax collectors
Labor earnings respond differently to income-tax and to payroll-tax reforms
Labor Earnings Respond Differently to Income-Tax and to Payroll-Tax Reforms
Corporate tax competition between firms
Does labor supply respond to a flat tax? Evidence from the Russian tax reform
How do Small Firms Respond to Tax Schedule Discontinuities? Evidence from South African Tax Registers
How do small firms respond to tax schedule discontinuities? Evidence from South African tax registers
How Do Firms Respond to Place-Based Tax Incentives?
Do multinational firms respond to personal dividend income tax rates?
Do multinational firms respond to personal dividend income tax rates?
Tax planning and tax uncertainty for multinational firms
Tax evasion by firms
Firms as tax collectors
Labor earnings respond differently to income-tax and to payroll-tax reforms
Labor Earnings Respond Differently to Income-Tax and to Payroll-Tax Reforms
Corporate tax competition between firms