Stimuli contributing to local property taxation – with the focus on spatial effects of industry and functional urban areas

Zdražil Pavel () and Pernica Bohuslav
Additional contact information
Zdražil Pavel: Faculty of Economics and Administration, University of Pardubice
Pernica Bohuslav: Faculty of Economics and Administration, University of Pardubice

Central European Journal of Public Policy, 2021, vol. 15, issue 1, 55-66

Abstract: In this study, we argue that a historical background of the region matters in tax mimicking and yardstick competition as a matter of principle. We seek to determine factors supporting the policy of the high local property tax in the Czech Republic. Based on the statistical and spatial data of 6,258 municipalities between 2009 and 2019, the results show that the municipalities burdened by large industrial facilities, as well as municipalities in the functional urban areas (FUAs), apply the policy of higher property taxation twice frequently than the rest. On the other hand, the industrial stimuli keep enfeebling after 2010, and the number of local governments preferring high property taxation is variegated across different FUAs. The causal analysis based on Granger's approach concludes an existence of cumulative effects of both industry and the FUAs, which push the municipalities with large industrial facilities located within an FUA to increase the property taxes. From the mimicking point of view, we found that mimicking policy is an important phenomenon among the municipalities of Czech Republic; however, it has different impacts on both stimuli (Industry and FUA). The analysis suggests that it rather incites the municipalities within the FUA to increase the local property taxes.

Keywords: Czech Republic; functional urban area (FUA); industry; property tax; local government; tax mimicking (search for similar items in EconPapers)
JEL-codes: H71 O18 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.2478/cejpp-2021-0004 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:vrs:cejopp:v:15:y:2021:i:5:p:55-66:n:5

DOI: 10.2478/cejpp-2021-0004

Access Statistics for this article

Central European Journal of Public Policy is currently edited by Martin Nekola

More articles in Central European Journal of Public Policy from Sciendo
Bibliographic data for series maintained by Peter Golla ().