Quantification of changes in the CIT gap: an econometric approach

Karolina Konopczak () and Aleksander Łożykowski ()
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Karolina Konopczak: Ministry of Finance in Poland
Aleksander Łożykowski: Ministry of Finance in Poland

No 39, MF Working Papers from Ministry of Finance in Poland

Abstract: This article proposes an econometric approach to the estimation of changes in the CIT gap as well as to their decomposition into cyclical and structural components. The method was used to estimate changes in the CIT gap in Poland in years 2016 through 2018. The obtained results indicate that around 40 percent of an increase in CIT revenues over this period (i.e. 6 billion PLN) was of structural nature, i.e. cannot be explained either by the growth in the tax base, or the phase of the business cycle. Due to the lack of any major changes in CIT system over this period of time, this increase can be attributed to improved efficiency of tax collection.

Keywords: CIT gap; cyclicality of tax revenues; non-linear cointegration (search for similar items in EconPapers)
JEL-codes: C22 C24 E32 H25 H26 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2019-12-30, Revised 2020-07-01
New Economics Papers: this item is included in nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:ris:mfplwp:0039

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