Local Fiscal Capacity in the New Members of the European Union: Is It Efficient?

Nikolay Patonov

Abstract


Purpose – This paper aims to analyze the efficiency of the fiscal capacity of the local governments in the new members of the EU.
Design/methodology/approach – The impact of the locally collected taxes on economic growth is analyzed by the means of regression analysis. The GDP growth rate is adopted as a  dependent variable in the model and its deviations are explained via tax instruments for building fiscal capacity.
Findings – Strong positive effects on economy, when property taxes come in local budgets.
Research limitations/implications – There are many factors affecting the economic growth, which are not included in the regression model. The effects of the charges levied by local governments also remain without estimation.
Originality/Value - The study fills in the gap of research on the benefits of local fiscal capacity in the countries of interest.

Keywords


property taxes; shared taxes; total government expenditure; economic growth; research; new member states, synergy

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DOI: http://dx.doi.org/10.17951/ijsr.2013.2.1-2.57
Data publikacji: 2013-07-14 00:00:00
Data złożenia artykułu: 2015-07-18 02:52:27

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