What makes some flat tax systems better than others in terms of tax revenue generation? A comparative case study analysis of Belize, Bolivia, Nauru, and Timor-Leste
Document Type
Event
Faculty Mentor
Michael Cauvel
Abstract
The research on flat tax policy covers five main areas: theoretical flat tax proposals; comparisons between flat and progressive tax systems; comparisons among flat tax systems; the impact of progressivity on tax systems; and other macroeconomic effects of flat tax systems. Much of this scholarship has been concentrated around examples in Eastern Europe and built up significant academic capital. The purpose of this research paper is to understand what makes some flat tax systems better than others from the standpoint of revenue generation in often neglected geographic areas. I will comparative analyze case studies in Belize, Bolivia, Nauru, and Timor-Leste. Each of these will be evaluated based on their overall structure and composition in the country and set against tax revenue as a share of GDP figures. While this research project’s findings have not yet been solidified, my hypothesis is that the differences in effective tax rates and extent of tax allowances will be the contributing factors that distinguish flat tax systems’ relative success from one another; some of these results have already been established in European case studies, and finding truth to the claims elsewhere would be a major breakthrough for crafting more beneficial flat tax policy globally.
What makes some flat tax systems better than others in terms of tax revenue generation? A comparative case study analysis of Belize, Bolivia, Nauru, and Timor-Leste
The research on flat tax policy covers five main areas: theoretical flat tax proposals; comparisons between flat and progressive tax systems; comparisons among flat tax systems; the impact of progressivity on tax systems; and other macroeconomic effects of flat tax systems. Much of this scholarship has been concentrated around examples in Eastern Europe and built up significant academic capital. The purpose of this research paper is to understand what makes some flat tax systems better than others from the standpoint of revenue generation in often neglected geographic areas. I will comparative analyze case studies in Belize, Bolivia, Nauru, and Timor-Leste. Each of these will be evaluated based on their overall structure and composition in the country and set against tax revenue as a share of GDP figures. While this research project’s findings have not yet been solidified, my hypothesis is that the differences in effective tax rates and extent of tax allowances will be the contributing factors that distinguish flat tax systems’ relative success from one another; some of these results have already been established in European case studies, and finding truth to the claims elsewhere would be a major breakthrough for crafting more beneficial flat tax policy globally.
