• Management & Information Systems Review
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• v.30 no.3
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• pp.169-190
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• 2011

Recent academic studies have investigated book-tax differences as an indicator of earnings management. Tax accounting texts claim that the differences between pre-tax financial reporting earnings and taxable income can provide information about current earnings, and the large differences between book and taxable incomes are an indicator of low-quality financial reporting earnings. This study investigates the effect of internal control system over book and tax difference using the KOSPI and KOSDAQ firms from 2006 to 2008. The empirical findings are consistent with a weakness of internal control system being associated with higher book-tax difference. That means a firm which has material weakness in the internal control system allows for more malpractice. In addition to this, If the managers tries to the efficient tax decrease strategy, book-tax difference can be large. Which in turn leads us to observe a positive relation between the weakness of internal control system and intensity of book-tax difference. Overall, we interpret this evidence as indicating that the failure of the internal control system can effect not only investors and creditors but also tax authorities. And It emphasizes that a more effective internal control system linked with sound corporate governance.

• Management & Information Systems Review
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• v.29 no.1
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• pp.79-96
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• 2010

The purpose of this study is to investigate factors that affect corporate CEOs' tax avoidance, ultimately helping find how to fundamentally prevent the avoidance, establish a tax system that ensures tax payers' compliance and revise tax laws and regulations in a positive way. For the purpose, this researcher surveyed corporate CEOs with a questionnaire that contained many questions of various types, which was developed based on previous studies. Findings of the study can be summarized as follows. Main factors affecting tax avoidance were the application of tax provisions, the ability to understand tax laws and the expectation of tax avoidance. The more corporate CEOs' were influenced by the first and the third factors, the higher their propensity for tax avoidance was. On the contrast, corporate CEOs were lower in propensity for tax avoidance when they were more able to understand tax laws. Regarding the three factors' relative influences, tax avoidance was most affected by the expectation of tax avoidance, followed by the ability to understand tax laws and the application of tax provisions in order. Meanwhile, a multi-regression analysis using the sequential deletion technique showed that tax avoidance were affected by the application of tax provisions and the expectation of tax avoidance and that tax avoidance was most influenced by the application of tax provisions, followed by the expectation of tax avoidance. These findings indicate that the degree of corporate CEOs' tax avoidance may vary depending on social and environmental changes that their business face. Meanwhile, positive factors such as tax-bearing capacity and the procedure of tax calculation and negative factors such as management ethics and tax authorities' regulation are all thought to be not helping prevent tax avoidance.

• Environmental and Resource Economics Review
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• v.32 no.4
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• pp.217-238
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• 2023

Currently, automobile tax in Korea is imposed by multiplying the vehicle's engine displacement by a certain tax rate. However, the need for revision is being raised as it is pointed out that the current system does not reflect the immediate task of reducing greenhouse gas emissions. Accordingly, this study focuses on the positive relationship between engine displacement and CO₂ emissions, and seeks to calculate an appropriate automobile tax rate considering average CO₂ emissions. To this end, first, we estimated the average annual CO₂ emissions (kg/vehicle) for each engine displacement using the average CO₂ emissions for each vehicle displacement as of 2020. Next, multiple scenarios were analyzed considering the standard tax rate at $75 per ton of CO₂ emissions proposed by the IMF (2019). In particular, we compared the case of imposing a uniform carbon tax of $75 and the case of imposing a progressive tax based on CO₂ emissions by displacement. According to the results, it was confirmed that the uniform tax rate proposed by the IMF is difficult to apply to Korea as it is due to the impact of a decrease in tax revenue, and a tax scheme needs to be designed appropriately considering maintenance of tax revenue according to the current automobile tax, greenhouse gas reduction effect, and automobile tax reform trends in developed countries. For example, in the case of the K3 (1,598cc) of Kia Motors, a representative compact car sold in Korea, if we compare the tax burdens for each tax scenario, the tax burden will be about 220,000 KRW under the current system, about 79,000 KRW under the uniform tax rate, about 83,000 KRW under the progressive tax rate, and about 240,000 KRW under the progressive tax rate similar to the UK tax system, respectively. In this way, this study identified the current statuses of automobile registration and tax in Korea, and automobile tax reform trends in major developed countries, and analyzed the impact of automobile tax reform considering engine displacement and CO₂ emissions, focusing on the tax burden of the people.

• Journal of Labour Economics
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• v.41 no.4
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• pp.1-30
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• 2018

The 1995 tax reform in Korea has brought adjustment to the tax bracket, marginal tax rate, and tax deduction system which resulted in significant decrease in the income tax progressivity. In this paper we study the causal effect of the tax reform on male labor supply using difference-in-differences method. Using the data from Economic Active Population Survey (EAPS) and Daewoo Panel Data, we find about 1.5% increase in the hours worked of male wage workers.

• Journal of Applied Tourism Food and Beverage Management and Research
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• v.13 no.1
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• pp.81-110
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• 2002

The temporary tax deduction on investment cutting the corporate income tax within 10% of the amount of investment is aimed at stimulating the investment for economic activity. 25 business sectors are applied to this tax law and in tourism, the accommodation registered by tour promotion law and international convention plan business belong to it. I'd like to mention the problem of the temporary tax deduction on investment amount for hotels and suggest better solutions. This tax law is so temporary applied that we shouldn't get tax deduction after June 30, 2002. So, we can't get income tax deduction on the investment out of the available period. And further more this tax law has a rule not real investment but solely new project investment for hotels. There are numbers of difference between real investment and new project investment. The amount of investment is based on an object of acquisition taxation. And also there are numbers of difference between real investment and an object of acquisition taxation. For example, landscape construction is a great part of hotel construction but it's not an object of acquisition taxation. For running hotel business, we also need lots of equipments such as linens utensils for restaurant and decorations for hotel interior. But these are also excluded from this tax law. As you know, these equipments can be regarded as product equipments in manufacture industry. Therefore we should take the specificity of hotel investment into consideration and expand the role of the temporary income tax deduction on investment amount for hotels.

• The Journal of the Korea Contents Association
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• v.8 no.3
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• pp.205-214
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• 2008

The aim of this study is to examine if there is a difference in the recognition of the tax audit between a tax representative and a taxpayer and in the recognition of the tax audit according to characteristics of a tax representative and a taxpayer, and an analysis has been made to heighten fairness and effectiveness of a system of the tax audit. As a result of the analysis, there is a difference in a analysis of a subject variable in both a tax representative and a taxpayer. An alternative policy is required to promote fairness and effectiveness of the tax audit on the basis of the findings in the future.

• The Journal of Economics, Marketing and Management
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• v.6 no.3
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• pp.14-25
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• 2018

Purpose - Taxes cover all aspects of society, especially in terms of resource allocation and economic growth. In reality, the tax revenue is often used to measure the quality of a country's economy. The relationship between tax revenue and economic growth has been paid much attention by academic circles. Due to this background, this paper attempts to investigate the mutual effect between tax revenue and economic growth. Research design, data, and Methodology - The annual datum form 1980 to 2017 are employed to conduct an empirical analysis under the vector error correction model. In this paper, the GDP is treated as an independent variable. The tax revenue is treated as a dependent variable. Furthermore, a menu of statistic approaches will be used to testify the mutual effect between tax revenue and economic growth. Results - Via the co-integration test, the results report that the tax revenue has a positive effect on economic growth in the long run. Through the vector error correction estimation, the results also report that the tax revenue also has a positive effect on economic growth in the short run. Conclusions - This paper provides a view that the tax revenue is a kind of a determinant to promote economic growth. Therefore, the China's government should pay much attention to the improvement of tax revenue system so as to maintain a high-speed economic growth.

• Environmental and Resource Economics Review
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• v.24 no.3
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• pp.573-605
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• 2015

This study proposed scenarios of tax reform regarding taxation on bituminous coal for power generation since July 2015 and July 2014, estimated its impact on SMP, settlement price, tax revenue from year 2015 to year 2029. These scenarios are compared with those of the standard scenario. To estimate them, the power system simulation was performed based on the government plan, such as demand supply program and the customized model to fit Korea's power system and operation. Imposing a tax on bituminous coal for power generation while maintaining tax neutrality reducing tax rate on LNG, the short-term SMP is lowered than the one of the standard scenario. Because the cost of nuclear power generation is still smaller than costs of other power generation, and the nuclear power generation rarely determines SMPs, the taxation impact on SMP is almost nonexistent. Thus it is difficult to slow down the electrification of energy consumption due to taxation of power plant bituminous coal in the short term, if SMP and settlement price is closely related. However, in the mid or long term, if the capacity of coal power plant is to be big enough, the taxation of power plant bituminous coal will increase SMP. Therefore, if the tax reform is made to impose on power plant bituminous coal in the short term, and if the tax rate on LNG is to be revised after implementing big enough new power plants using bituminous coal, the energy demand would be reduced by increasing electric charges through energy tax reform. Both imposing a tax on power plant bituminous coal and reducing tax rate on LNG increase settlement price, higher than the one of the standard scenario. In the mid or long term, the utilization of LNG complex power plants would be lower due to an expansion of generating plants, and thus, the tax rate on LNG would not affect on settlement price. Unlike to the impact on SMP, the taxation on nuclear power plants has increased settlement price due to the impact of settlement adjustment factor. The net impact of energy taxation will depend upon the level of offset between settlement price decrease by the expansion of energy supply and settlement price increase by imposing a tax on energy. Among taxable items, the tax on nuclear power plants will increase the most of additional tax revenue. Considering tax revenues in accordance with energy tax scenarios, the higher the tax rate on bituminous coal and nuclear power, the bigger the tax revenues.

• Korean System Dynamics Review
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• v.7 no.2
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• pp.149-170
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• 2006

In this paper, an energy-economy-environment dynamic simulation model was developed to using system dynamics methodology. It describes current energy-economy-environment systems and forecasts changes caused by levying of carbon tax. The model is composed of three modules: an energy module, an economic module and an environmental module. Variables are interrelated in each module, and three modules are linked by several linkage variables. Setting up the linkage variables is an important factor for the composition of the model. The simulation result shows a change of the national GDP, usage of energy, and $CO_2$ emissions under levying and reinvestment of carbon tax considering various scenarios for the charging cost.

• Korea Journal of Hospital Management
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• v.23 no.4
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• pp.81-86
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• 2018

Purposes: The purpose of this study is to argue that the taxation system for non-for-profit medical institution in Korea should be revised and that the basic direction should be to expand tax exemption like the US. Methods: We analyzed the US context of taxation policy for non-for-profit medical institutions and compared the US and Korean situation. Findings: In the United States, for-profit or non-for-profit medical institutions eternities are the most important criteria for hospital classification. Basically, full tax-exemption has been applied for non-for-profit medical institutions. The reason why many hospitals maintain their status as non-for-profit are following. First, the American society places great importance on the social responsibility and role of non-for-profit hospitals. Second, maintaining the status of non-for profit medical institutions is financially beneficial while maintaining good social reputation. The most powerful financial incentives are tax deductions and tax deductions for donations. Practical Implications: How will the taxation system for medical institutions in Korea be reformed in the future? First, if Korean government do not allow for-profit medical institutions, Korean government should consider implementing a full tax exemption system suitable for non-profit medical institutions like the US. Second, there are many variation in taxation for non-for-profit medical institution according to their legal positions. Therefore, current taxation system should be revised. Third, the reorganization of such taxation system should be in a direction that can finally encourage community benefit activities of medical institutions of nonprofit hospitals.