COMPARATIVE ANALYSIS OF VARIOUS PRINCIPLES OF THE GRANTING TAX HOLIDAYS
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COMPARATIVE ANALYSIS OF VARIOUS PRINCIPLES OF THE GRANTING TAX HOLIDAYS
Annotation
PII
S042473880000616-6-1
Publication type
Article
Status
Published
Authors
Alexander Slastnikov
Edition
Pages
78-91
Abstract
The paper considers the model of investment attraction for creation of new enterprises in the real sector through the mechanism of tax holidays. In the framework of this model, considering the stochastic dynamics of the profi ts from the enterprise, we give a comparative analysis of three principles of granting tax holidays on profi t tax: 1) holidays of determined (fi xed) duration; 2) holidays based on the payback period of initial investment; 3) holidays based on the level of profi t. For estimating potential possibilities of tax holidays we use an optimization approach to the specifi cation of tax holidays options. The optimality criterions are the expected discounted tax payments from the created enterprise into the consolidated budget. We use the investment level (which characterizes the time of the investor's entry) as indices for comparing the NPV from created enterprise, as well as the expected discounted tax payments from the created enterprise into the federal and regional budgets. The comparison is conducted for three types of tax holidays on profi t tax which are really used in Russia: full, partial and regional holidays.
Keywords
investment project, tax holidays, stochastic process of profits, profit tax, expected tax payments into the budget, payback period
Date of publication
01.07.2016
Number of purchasers
0
Views
163
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## References

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Tax Incentives and Foreign Direct Investment. A Global Survey (2000). ASIT Advisory Studies. No. 16. UNCTAD. N.Y., Geneva: United Nations.