Evaluation of the Effectiveness of Income Tax Policy in the era of Globalization
DOI:
https://doi.org/10.62872/jz6s6d60Keywords:
Tax Policy, Globalization, Tax Competition, Corporate Taxation, Tax IncentivesAbstract
Tax policies play a crucial role in shaping economic growth and investment decisions in an increasingly globalized world. This study examines the impact of globalization on national tax policies, focusing on tax competition, corporate taxation, and the challenges of maintaining revenue stability. Globalization has intensified tax competition among countries, often leading to reduced corporate tax rates to attract foreign investments. While tax incentives can stimulate economic activity, they may also erode government revenues and create disparities in tax burdens. This research explores the role of international tax treaties in harmonizing tax regulations and reducing tax avoidance strategies by multinational corporations. Furthermore, the study highlights the transition from income-based to consumption-based taxation as a response to shifting economic dynamics. The findings suggest that policymakers must balance tax competitiveness with sustainable revenue generation to ensure economic stability. By analyzing recent tax reforms and policy adaptations, this study provides insights into the complexities of taxation in a globalized economy and offers recommendations for future tax strategies.
Downloads
References
Ahrens, L., & Bothner, F. (2020). The big bang: Tax evasion after automatic exchange of information under FATCA and CRS. New Political Economy, 25(6), 849-864.
Alm, J., & Torgler, B. (2011). Do ethics matter? Tax compliance and morality. Journal of Business Ethics, 101(4), 635-651. https://doi.org/10.1007/s10551-011-0761-9
Arnold, B. J., Ault, H. J., & Cooper, G. (Eds.). (2019). Comparative income taxation: a structural analysis. Kluwer Law International BV.
Balsalobre-Lorente, D., Shahbaz, M., Murshed, M., & Nuta, F. M. (2023). Environmental impact of globalization: The case of central and Eastern European emerging economies. Journal of Environmental Management, 341, 118018.
Baskoro, B. D., Simanjuntak, R., & Sudarmadji. (2024). Pengaruh insentif pajak terhadap inovasi dan kinerja perusahaan: Tinjauan literatur. Labs: Jurnal Bisnis dan Manajemen, 29(3), 6-16. https://doi.org/10.57134/labs.v29i3.101
Bickley, S. J., Chan, H. F., Skali, A., Stadelmann, D., & Torgler, B. (2021). How does globalization affect COVID-19 responses?. Globalization and health, 17(1), 57.
Copeland, B. R., Shapiro, J. S., & Taylor, M. S. (2021). Globalization and the Environment. Welcome to the electronic edition of Australia’s Economy in its International Context, volume 2. The book opens with the bookmark panel and you will see the contents page/s. Click on this anytime to return to the contents. You can also add your own bookmarks., 575.
Devereux, M. P., Auerbach, A. J., Keen, M., Oosterhuis, P., Schön, W., & Vella, J. (2020). Taxing profit in a global economy. Oxford University Press.
Egger, P. H., Nigai, S., & Strecker, N. M. (2019). The taxing deed of globalization. American Economic Review, 109(2), 353-390.
European Commission. (2021). Taxation trends in the European Union: Data for the EU Member States, Iceland, Norway and United Kingdom. Publications Office of the European Union. https://ec.europa.eu/taxation
Forster, T., Kentikelenis, A. E., Stubbs, T. H., & King, L. P. (2020). Globalization and health equity: The impact of structural adjustment programs on developing countries. Social Science & Medicine, 267, 112496.
Gandullia, L., & Piserà, S. (2020). Do income taxes affect corporate social responsibility? Evidence from European‐listed companies. Corporate Social Responsibility and Environmental Management, 27(2), 1017-1027.
Haseeb, A., Xia, E., Saud, S., Ahmad, A., & Khurshid, H. (2019). Does information and communication technologies improve environmental quality in the era of globalization? An empirical analysis. Environmental Science and Pollution Research, 26, 8594-8608.
International Monetary Fund (IMF). (2021). Digitalization and Taxation in a Global Economy. IMF Publications. https://www.imf.org/en/Publications
International Monetary Fund (IMF). (2022). Big Data and Tax Compliance: Improving Revenue Collection and Reducing Evasion. IMF Working Paper.
Jha, P., & Gozgor, G. (2019). Globalization and taxation: Theory and evidence. European Journal of Political Economy, 59, 296-315.
Kamal, M., Usman, M., Jahanger, A., & Balsalobre-Lorente, D. (2021). Revisiting the role of fiscal policy, financial development, and foreign direct investment in reducing environmental pollution during globalization mode: evidence from linear and nonlinear panel data approaches. Energies, 14(21), 6968.
Korinek, A., & Stiglitz, J. E. (2021). Artificial intelligence, globalization, and strategies for economic development (No. w28453). National Bureau of Economic Research.
Lencucha, R., Pal, N. E., Appau, A., Thow, A. M., & Drope, J. (2020). Government policy and agricultural production: a scoping review to inform research and policy on healthy agricultural commodities. Globalization and health, 16(1), 11.
Leviner, S. (2014). The Intricacies of Tax and Globalization. Columbia Journal of Tax Law, 5, 207-227. https://doi.org/10.7916/D8RR1XNH
Navarro, V. (2020). Health and equity in the world in the era of" globalization". In The Political Economy of Social Inequalities (pp. 109-119). Routledge.
Nyonyoh, N., Ziorklui, J.E., Ampofo, F.O., & Antwi, B.O. (2024). Globalization and taxation: Implications on national tax policies and international tax competition. Finance & Accounting Research Journal. https://doi.org/10.51594/farj.v6i7.1323
Organisation for Economic Co-operation and Development (OECD). (2021). Addressing the Tax Challenges of the Digital Economy. OECD Publishing. https://doi.org/10.1787/9789264218789-en
Organisation for Economic Co-operation and Development (OECD). (2022). Base erosion and profit shifting (BEPS) action plan: Global tax reform initiatives. OECD Publishing.
Öz-yalaman, G., Sevinç, D., & Sevil, G. (2019). The impact of globalization on corporate taxation: evidence from the KOF globalization index. Ekonomi Politika ve Finans Araştırmaları Dergisi, 4(3), 350-369.
Sokolovska, A., Zatonatska, T., Stavytskyy, A., Lyulyov, O., & Giedraitis, V. (2020). The impact of globalization and international tax competition on tax policies. *Research in World Economy, 11*(4), 1-13. https://doi.org/10.5430/rwe.v11n4p1
Taghizadeh‐Hesary, F., Yoshino, N., & Shimizu, S. (2020). The impact of monetary and tax policy on income inequality in Japan. The World Economy, 43(10), 2600-2621.
Ullah, S., Ali, K., Shah, S. A., & Ehsan, M. (2022). Environmental concerns of financial inclusion and economic policy uncertainty in the era of globalization: evidence from low & high globalized OECD economies. Environmental Science and Pollution Research, 29(24), 36773-36787.
World Bank. (2020). Enhancing tax administration efficiency through digital transformation. World Bank Report. https://www.worldbank.org/taxpolicy
Zameer, H., Shahbaz, M., & Vo, X. V. (2020). Reinforcing poverty alleviation efficiency through technological innovation, globalization, and financial development. Technological Forecasting and Social Change, 161, 120326.
Downloads
Published
Issue
Section
License
Copyright (c) 2025 Loso Judijanto, Olyvia Rosalia, Selly Swandari, Firayani Firayani (Author)
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
