Český finanční a účetní časopis 2021(4):31-54 | DOI: 10.18267/j.cfuc.567

Taxation in Developed Countries: Response to External Shocks in 2008–2009 and 2020

Leoš Vítek, Markéta Arltová, Květa Kubátová
Vysoká škola ekonomická v Praze, Fakulta financí a účetnictví, katedra veřejných financí, Praha

Based on OECD Revenue Statistics data, the article analyses the impact of two external shocks (the great financial depression of 2008-2009 and covid-19 in 2020) on the size and structure of tax revenues for OECD countries. Using the descriptive statistics and cluster analysis, the authors have established that the tax systems of both developed and developing countries responded to the external shocks in 2008–2009 and 2020+ with a decline in the overall tax burden (tax to GDP ratios), due to a faster decline in nominal tax revenues than in nominal GDP. The decline was more pronounced in 2009 and within developing countries. During both shocks, the share of income taxes (incl. social security contributions) has dropped, while this decline was more intense in 2009. In 2009, the importance of consumption taxes has increased, and in 2020 it decreased. The clusters of countries in terms of the size and structure of taxes are basically the same throughout the period 2008–2020. However, it is not possible to unambiguously identify clusters of countries that would respond to both shocks in their tax policy and taxation system in the same way.

Keywords: Tax policy; Tax Revenue; Shock.
JEL classification: H20, H60

Received: January 2, 2022; Revised: January 4, 2022; Accepted: January 4, 2022; Prepublished online: February 7, 2022; Published: February 8, 2022  Show citation

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Vítek, L., Arltová, M., & Kubátová, K. (2021). Taxation in Developed Countries: Response to External Shocks in 2008–2009 and 2020. Czech Financial and Accounting Journal, 2021(4), 31-54. doi: 10.18267/j.cfuc.567
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