International E-publication: Publish Projects, Dissertation, Theses, Books, Souvenir, Conference Proceeding with ISBN.  International E-Bulletin: Information/News regarding: Academics and Research

Tax Policy Changes and their Impact on Tax Revenue: A Case Study in Sri Lanka

Author Affiliations

  • 1 Department of Accounting, Faculty of Management Studies and Commerce, University of Jaffna, SRI LANKA

Int. Res. J. Social Sci., Volume 3, Issue (10), Pages 55-63, October,14 (2014)

Abstract

The tax revenue is one of the major sources of income in every government. Tax policy changes play an important role in the country’s tax revenue. The main purpose of this study is to find out the impact of tax policy changes on tax revenue of Sri Lanka. Data on the tax revenue and tax policy changes were collected from the year 1990 to 2012 for this study purpose. Correlation and regression analysis were performed in this study to analyze the hypothesis of the study. The results reflect that there is significant association between tax policy changes and tax revenue of the country (P 0.01). The regression analysis confirmed that there is significant impact of tax policy changes on tax revenue of Sri Lanka furthermore the regression analysis’s R2 revealed that tax policy changes impact by 49.6% on tax revenue of the country (R = .496). According to the correlation analysis and regression analysis confirmed that the country’s tax revenue significantly impact and associate by the tax policy changes. Now a day every county is facing the economic crisis all over the world especially the number of developing countries are facing the budget deficit in every budget which is not good for the economic stability and development of Particular County. Here the tax policy changes are one of the major tools to the government to impact the tax revenue as well budget deficit as their needed.

References

  1. Lymer A. and Oats L., Taxation: Policy and Practice. 16th ed. Birmingham: Fiscal Publications (2009)
  2. Shanmugam S., Managing self assessment - an appraisal: Tax Nasional, 1st Quarter, 30-32 (2003)
  3. Anojan V., Advanced Business Taxation: Principles and Practices. Jaffna: V.Agastina Jayamalar (2013)
  4. Central Bank of Sri Lanka, Annual Report. Sri Lanka: Central Bank of Sri Lanka and Central Bank of Sri Lanka, (2013). Economic and Social Statistics of Sri Lanka. Sri Lanka: Published by Statistics Department Central Bank of Sri Lanka (2012)
  5. Dessai M.A., Foley C.F. and Hines J.R., Foreign Direct Investment in a World of Multiple Tax, Journal of Public Economics, 88, 2727-2744 (2004)
  6. Lim D., Instability of Government Revenue and Expenditure in Less Developed Countries, World Development, 11(5), 447-450 (1983)
  7. Gober J.R. and Burns J.O., The Relationship between Tax Structures and Economic Indicators. Journal of International Accounting, Auditing and Taxation,6, l-24 (1997)
  8. Mahdavi S., The level and composition of tax revenue in developing countries: Evidence from unbalanced panel data. International Review of Economics and Finance,17,607–617 (2008)
  9. Hinrisch H.H., A general theory of tax structure change during economic development, Harvard Law School International Tax Program Development (1966)
  10. Leuthold J.H., Tax shares in developing economies: A panel study. Journal of Development Economics, 35,173 185 (1991)