Published on 01 Dec 12
by "AUSTRALIAN TAX FORUM" JOURNAL ARTICLE
This paper is concerned with the search for an appropriate Presumptive Income Tax (PIT) design for taxing large informal economies in developing countries.The mixed results from PIT designs in developing Finding a suitable PIT design is essential of existing PIT regimes in most developing countries. To find a suitable PIT design, this paper compares common PIT designs on their merits and flaws using the commonly-accepted principles of a good tax system as a normative guide.
The causes of the informal economy are also taken into account in this search for the most effective PIT design. This paper concludes that asset-based PIT regimes suit large informal economies in developing countries better than alternative PIT designs when assessed under the principles of a good tax system.
Najeeb is a PhD candidate in the School of Business Law & Taxation at the The Australian
School of Business UNSW.
Current at 1 April 2010
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