Kuldeep Singh Negi who was an explorer and the collector of Allium. Australia fast bowler James Pattinson has retired from international cricket ahead of the —22 Ashes series. On Oct 18, , The first Black U. Inline Feedbacks. Load More Comments. Contact — [email protected]. Click Here to Download. For instance, Alabama, Indiana, Michigan, and Pennsylvania allow local income add-ons, but are still among the states with the lowest overall rates.
Top Tax Bracket Threshold. This variable assesses the degree to which pass-through businesses are subject to reduced after-tax return on investment as net income rises. States are rewarded for a top rate that kicks in at lower levels of income, because doing so approximates a less distortionary flat-rate system.
For example, Alabama has a progressive income tax structure with three income tax rates. States with flat-rate systems score the best on this variable because their top rate kicks in at the first dollar of income after accounting for the standard deduction and personal exemption.
States with high kick-in levels score the worst. The Index converts exemptions and standard deductions to a zero bracket before tallying income tax brackets. From an economic perspective, standard deductions and exemptions are equivalent to an additional tax bracket with a zero tax rate. The size of allowed standard deductions and exemptions varies considerably. Pennsylvania scores the best in this variable by having only one tax bracket that is, a flat tax with no standard deduction.
On the other end of the spectrum, Hawaii scores worst with 13 brackets, followed by California with 11 brackets, and Iowa and Missouri with nine brackets. Average Width of Brackets. Many states have several narrow tax brackets close together at the low end of the income scale, including a zero bracket created by standard deductions and exemptions.
Most taxpayers never notice them, because they pass so quickly through those brackets and pay the top rate on most of their income. On the other hand, some states impose ever-increasing rates throughout the income spectrum, causing individuals and noncorporate businesses to alter their income-earning and tax-planning behavior. This subindex penalizes the latter group of states by measuring the average width of the brackets, rewarding those states where the average width is small, since in these states the top rate is levied on most income, acting more like a flat rate on all income.
Income Recapture. Income recapture provisions are poor policy, because they result in dramatically high marginal tax rates at the point of their kick-in, and they are nontransparent in that they raise tax burdens substantially without being reflected in the statutory rate.
States have different definitions of taxable income, and some create greater impediments to economic activity than others. The base subindex gives a 10 percent weight to the marriage penalty , a 40 percent weight to the double taxation of taxable income, and a 50 percent weight to an accumulation of other base issues, including indexation.
The states with no individual income tax of any kind achieve perfect neutrality. Of the other 43 states, Tennessee, Arizona, Idaho, Illinois, Maine, Michigan, Missouri, Montana, and Nebraska have the best scores, avoiding many problems with the definition of taxable income that plague other states. Meanwhile, states where the tax base is found to cause an unnecessary drag on economic activity include New Jersey, California, Ohio, Minnesota, Maryland, Delaware, and New York.
Marriage Penalty. As a result, two singles if combined can have a lower tax bill than a married couple filing jointly with the same income. This is discriminatory and has serious business ramifications. The top-earning 20 percent of taxpayers is dominated 85 percent by married couples. This same 20 percent also has the highest concentration of business owners of all income groups Hodge A, Hodge B. Because of these concentrations, marriage penalties have the potential to affect a significant share of pass-through businesses.
Twenty-three states and the District of Columbia have marriage penalties built into their income tax brackets. Some states attempt to get around the marriage penalty problem by allowing married couples to file as if they were singles or by offering an offsetting tax credit. While helpful in offsetting the dollar cost of the marriage penalty, these solutions come at the expense of added tax complexity. Still, states that allow for married couples to file as singles do not receive a marriage penalty score reduction.
Double Taxation of Capital Income. Since most states with an individual income tax system mimic the federal income tax code, they also possess its greatest flaw: the double taxation of capital income.
Double taxation is brought about by the interaction between the corporate income tax and the individual income tax. The ultimate source of most capital income—interest, dividends, and capital gains—is corporate profits. The corporate income tax reduces the level of profits that can eventually be used to generate interest or dividend payments or capital gains. The result is the double taxation of this capital income—first at the corporate level and again on the individual level.
All states that tax wage income score poorly by this criterion. Tennessee and New Hampshire, which tax individuals on interest and dividends, score somewhat better because they do not tax capital gains. Five states score poorly because they do not conform to federal definitions of individual income: Alabama, Arkansas, Mississippi, New Jersey, and Pennsylvania.
At the federal level, the Alternative Minimum Tax AMT was created in to ensure that all taxpayers paid some minimum level of taxes every year.
Unfortunately, it does so by creating a parallel tax system to the standard individual income tax code. AMTs are an inefficient way to prevent tax deductions and credits from totally eliminating tax liability. This variable measures the extent of double taxation on income used to pay foreign and state taxes, i. States can avoid double taxation by allowing a credit for state taxes paid to other jurisdictions.
One important development in the federal tax system was the creation of the limited liability corporation LLC and the S corporation. LLCs and S corporations provide businesses some of the benefits of incorporation, such as limited liability, without the overhead of becoming a traditional C corporation. The profits of these entities are taxed under the individual income tax code, which avoids the double taxation problems that plague the corporate income tax system.
Indexing the tax code for inflation is critical in order to prevent de facto tax increases on the nominal increase in income due to inflation. Three areas of the individual income tax are commonly indexed for inflation: the standard deduction, personal exemptions, and tax brackets. Twenty-five states index all three or do not impose an individual income tax; 15 states and the District of Columbia index one or two of the three; and ten states do not index at all.
Sales tax makes up The type of sales tax familiar to taxpayers is a tax levied on the purchase price of a good at the point of sale. The sales tax can also hurt the business tax climate because as the sales tax rate climbs, customers make fewer purchases or seek low-tax alternatives. As a result, business is lost to lower-tax locations, causing lost profits, lost jobs, and lost tax revenue. Typically, a vast expanse of shopping malls springs up along the border in the low-tax jurisdiction.
On the positive side, sales taxes levied on goods and services at the point of sale to the end-user have at least two virtues. First, they are transparent: the tax is never confused with the price of goods by customers. Second, since they are levied at the point of sale, they are less likely to cause economic distortions than taxes levied at some intermediate stage of production such as a gross receipts tax or sales taxes on business-to-business transactions.
The negative impact of sales taxes is well documented in the economic literature and through anecdotal evidence. For example, Bartik found that high sales taxes, especially sales taxes levied on equipment, had a negative effect on small business start-ups.
States that create the most tax pyramiding and economic distortion, and therefore score the worst, are states that levy a sales tax that generally allows no exclusions for business inputs. The ideal base for sales taxation is all goods and services at the point of sale to the end-user.
Excise taxes are sales taxes levied on specific goods. Goods subject to excise taxation are typically but not always perceived to be luxuries or vices, the latter of which are less sensitive to drops in demand when the tax increases their price.
Examples typically include tobacco, liquor, and gasoline. The sales tax component of the Index takes into account the excise tax rates each state levies. The five states without a state sales tax—Alaska, [27] Delaware, Montana, New Hampshire, and Oregon—achieve the best sales tax component scores.
Among states with a sales tax, those with low general rates and broad bases, and which avoid tax pyramiding , do best. Wyoming, Wisconsin, Maine, Idaho, Michigan, and Virginia all do well, with well-structured sales taxes and modest excise tax rates. At the other end of the spectrum, Alabama, Louisiana, Washington, Tennessee, and Arkansas fare the worst, imposing high rates and taxing a range of business inputs, such as utilities, services, manufacturing, and leases—and maintaining relatively high excise taxes.
Tennessee has the highest combined state and local rate of 9. In general, these states levy high sales tax rates that apply to most or all business input items. The tax rate itself is important, and a state with a high sales tax rate reduces demand for in-state retail sales.
Consumers will turn more frequently to cross-border sales, leaving less business activity in the state. This subindex measures the highest possible sales tax rate applicable to in-state retail shopping and taxable business-to-business transactions. Four states—Delaware, Montana, New Hampshire, and Oregon—do not have state or local sales taxes and thus are given a rate of zero.
Alaska is sometimes counted among states with no sales tax since it does not levy a statewide sales tax. However, Alaska localities are allowed to levy sales taxes and the weighted statewide average of these taxes is 1. The Index measures the state and local sales tax rate in each state.
A combined rate is computed by adding the general state rate to the weighted average of the county and municipal rates. State Sales Tax Rate. At the other end is California with a 7.
Other states with high statewide rates include Minnesota 6. Local Option Sales Tax Rates. Alabama and Louisiana have the highest average local option sales taxes 5. Other states with high local option sales taxes include Colorado 4. States with the highest combined state and average local sales tax rates are Tennessee 9.
At the low end are Alaska 1. Remote Seller Protections. While most states have adopted safe harbors for small sellers and have a single point of administration for all state and local sales taxes, a few diverge from these practices, imposing substantial compliance costs on out-of-state retailers.
Alabama, Alaska which only has local sales taxes , Colorado, and Louisiana lack uniform administration, while Kansas does not offer a safe harbor for small sellers. The top five states on this subindex—New Hampshire, Delaware, Montana, Oregon, and Alaska—are the five states without a general state sales tax.
However, none receives a perfect score because each levies gasoline, diesel, tobacco, and beer excise taxes. States like Wyoming, Kansas, Colorado, Idaho, Missouri, and Nebraska achieve high scores on their tax base by avoiding the problems of tax pyramiding and adhering to low excise tax rates, though of these, Colorado receives poor marks for a lack of local base conformity.
Their tax systems hamper economic growth by including too many business inputs, excluding too many consumer goods and services, and imposing excessive rates of excise taxation. When a business must pay sales taxes on manufacturing equipment and raw materials, then that tax becomes part of the price of whatever the business makes with that equipment and those materials.
The business must then collect sales tax on its own products, with the result that a tax is being charged on a price that already contains taxes. This tax pyramiding invariably results in some industries being taxed more heavily than others, which violates the principle of neutrality and causes economic distortions.
These variables are often inputs to other business operations. For example, a manufacturing firm will count the cost of transporting its final goods to retailers as a significant cost of doing business. Most firms, small and large alike, hire accountants, lawyers, and other professional service providers.
If these services are taxed, then it is more expensive for every business to operate. To understand how business-to-business sales taxes can distort the market, suppose a sales tax were levied on the sale of flour to a bakery. The bakery is not the end-user because the flour will be baked into bread and sold to consumers.
Economic theory is not clear as to which party will ultimately bear the burden of the tax. If customers tend not to change their bread-buying habits when the price rises, then the tax can be fully passed forward onto consumers.
However, if the consumer reacts to higher prices by buying less, then the tax will have to be absorbed by the bakery as an added cost of doing business.
The hypothetical sales tax on all flour sales would distort the market, because different businesses that use flour have customers with varying price sensitivity. Suppose the bakery is able to pass the entire tax on flour forward to the consumer but the pizzeria down the street cannot. The owners of the pizzeria would face a higher cost structure and profits would drop. Since profits are the market signal for opportunity, the tax would tilt the market away from pizza-making.
Fewer entrepreneurs would enter the pizza business, and existing businesses would hire fewer people. In both cases, the sales tax charged to purchasers of bread and pizza would be partly a tax on a tax because the tax on flour would be built into the price.
Economists call this tax pyramiding, and public finance scholars overwhelmingly oppose applying the sales tax to business inputs due to the resulting pyramiding and lack of transparency.
Besley and Rosen found that for many products, the after-tax price of the good increased by the same amount as the tax itself. That means a sales tax increase was passed along to consumers on a one-for-one basis.
For other goods, however, they found that the price of the good rose by twice the amount of the tax, meaning that the tax increase translates into an even larger burden for consumers than is typically thought. Note that these inputs should only be exempt from sales tax if they are truly inputs into the production process. Hawaii, New Mexico, South Dakota, and Washington are examples of states that tax many business inputs.
Sales Tax Breadth. An economically neutral sales tax base includes all final retail sales of goods and services purchased by the end-users. In practice, however, states tend to include most goods, but relatively few services, in their sales tax bases, a growing issue in an increasingly service-oriented economy. Professor John Mikesell of Indiana University estimates that, nationwide, sales taxes extend to about 36 percent of all final consumer transactions.
A well-structured sales tax, however, does not fall upon business inputs. Therefore, states that tax services that are business inputs score poorly on the Index , while states are rewarded for expanding their base to include more final retail sales of goods and services.
Sales Tax on Gasoline. There is no economic reason to exempt gasoline from the sales tax, as it is a final retail purchase by consumers. However, all but seven states do so. While all states levy an excise tax on gasoline, these funds are often dedicated for transportation purposes, making them a form of user tax distinct from the general sales tax.
The five states that fully include gasoline in their sales tax base Florida, Hawaii, Illinois, Indiana, and Michigan get a better score. Several other states receive partial credit for applying an ad valorem tax to gasoline sales, but at a different rate than for the general sales tax.
New York applies local sales taxes only. Sales Tax on Groceries. A well-structured sales tax includes all end-user goods in the tax base, to keep the base broad, rates low, and prevent distortions in the marketplace.
Many states exempt groceries to reduce the incidence of the sales tax on low-income residents. Such an exemption, however, also benefits grocers and higher-income residents, and creates additional compliance costs due to the necessity of maintaining complex, ever-changing lists of exempt and nonexempt products.
Thirteen states include or partially include groceries in their sales tax base. Excise taxes are single-product sales taxes but with distinct differences: excise taxes target specific transactions due to some unique characteristic often negative externalities , and general sales taxes fall on most consumer transactions. Many excise taxes are intended to reduce consumption of the product bearing the tax. Others, like the gasoline tax, are often used und specific projects such as road construction.
Gasoline and diesel excise taxes levied per gallon are usually justified as a form of user tax paid by those who benefit from road construction and maintenance. Though gas taxes—along with tolls—are one of the best ways to raise revenue for transportation projects roughly approximating a user fee for infrastructure use , gasoline represents a large input for most businesses, so states that levy higher rates have a less competitive business tax climate.
State excise taxes on gasoline range from General sales tax rates that apply to gasoline are included in this calculated rate, but states which include, or partially include, gasoline in the sales tax base are rewarded in the sales tax breadth measure.
Tobacco, spirits, and beer excise taxes can discourage in-state consumption and encourage consumers to seek lower prices in neighboring jurisdictions Moody and Warcholik, This impacts a wide swath of retail outlets, such as convenience stores, that move large volumes of tobacco and beer products.
The problem is exacerbated for those retailers located near the border of states with lower excise taxes as consumers move their shopping out of state—referred to as cross-border shopping. There is also the growing problem of cross-border smuggling of products from states and areas that levy low excise taxes on tobacco into states that levy high excise taxes on tobacco.
This both increases criminal activity and reduces taxable sales by legitimate retailers. The property tax component, which includes taxes on real and personal property, net worth, and the transfer of assets, accounts for When properly structured, property taxes exceed most other taxes in comporting with the benefit principle and can be fairly economically efficient.
Property taxes matter to businesses, and the tax rate on commercial property is often higher than the tax on comparable residential property. Additionally, many localities and states levy taxes on the personal property or equipment owned by a business.
They can be on assets ranging from cars to machinery and equipment to office furniture and fixtures, but are separate from real property taxes, which are taxes on land and buildings. The property taxes included tax on real, personal, and utility property owned by businesses Phillips et al. Since property taxes can be a large burden on business, they can have a significant effect on location decisions. Mark, McGuire, and Papke find taxes that vary from one location to another within a region could be uniquely important determinants of intraregional location decisions.
They find that higher rates of two business taxes—the sales tax and the personal property tax—are associated with lower employment growth. They estimate that a tax hike on personal property of one percentage point reduces annual employment growth by 2.
Bartik , finding that property taxes are a significant factor in business location decisions, estimates that a 10 percent increase in business property taxes decreases the number of new plants opening in a state by between 1 and 2 percent.
Bartik backs up his earlier findings by concluding that higher property taxes negatively affect the establishment of small businesses. He elaborates that the particularly strong negative effect of property taxes occurs because they are paid regardless of profits, and many small businesses are not profitable in their first few years, so high property taxes would be more influential than profit-based taxes on the start-up decision.
States which keep statewide property taxes low better position themselves to attract business investment. Localities competing for business can put themselves at a greater competitive advantage by keeping personal property taxes low. Taxes on capital stock, tangible and intangible property, inventory, real estate transfers, estates, inheritance, and gifts are also included in the property tax component of the Index.
These states generally have low rates of property tax, whether measured per capita or as a percentage of income. They also avoid distortionary taxes like estate, inheritance, gift, and other wealth tax es.
These states generally have high property tax rates and levy several wealth-based taxes. The property tax portion of the Index is composed of two equally weighted subindices devoted to measuring the economic impact of both rates and bases.
The rate subindex consists of property tax collections measured both per capita and as a percentage of personal income and capital stock taxes. The base portion consists of dummy variables detailing whether each state levies wealth taxes such as inheritance, estate, gift, inventory, intangible property, and other similar taxes.
The property tax rate subindex consists of property tax collections per capita 40 percent of the subindex score , property tax collections as a percent of personal income 40 percent of the subindex score , and capital stock taxes 20 percent of the subindex score.
The heavy weighting of tax collections is due to their importance to businesses and individuals and their increasing size and visibility to all taxpayers.
Both are included to gain a better understanding of how much each state collects in proportion to its population and its income. Tax collections as a percentage of personal income forms an effective rate that gives taxpayers a sense of how much of their income is devoted to property taxes, and the per capita figure lets them know how much in actual dollar terms they pay in property taxes compared to residents of other states.
While these measures are not ideal—having effective tax rates of personal and real property for both businesses and individuals would be preferable—they are the best measures available due to the significant data constraints posed by property tax collections.
Since a high percentage of property taxes are levied on the local level, there are countless jurisdictions. The sheer number of different localities makes data collection almost impossible. The few studies that tackle the subject use representative towns or cities instead of the entire state. Thus, the best source for data on property taxes is the Census Bureau, because it can compile the data and reconcile definitional problems.
States that maintain low effective rates and low collections per capita are more likely to promote growth than states with high rates and collections. Property Tax Collections Per Capita. Property tax collections per capita are calculated by dividing property taxes collected in each state obtained from the Census Bureau by population.
Effective Property Tax Rate. This provides an effective property tax rate. States with the highest effective rates and therefore the worst scores are New Hampshire 5. States that score well with low effective tax rates are Alabama 1. Capital Stock Tax Rate. Capital stock taxes sometimes called franchise taxes are levied on the wealth of a corporation, usually defined as net worth.
They are often levied in addition to corporate income taxes, adding a duplicate layer of taxation and compliance for many corporations. Corporations that find themselves in financial trouble must use their limited cash flow to pay their capital stock tax. In assessing capital stock taxes, the subindex accounts for three variables: the capital stock tax rate; the maximum payment; and whether any capital stock tax is imposed in addition to a corporate income tax, or whether the business is liable for the higher of the two.
The capital stock tax subindex is 20 percent of the total rate subindex. This variable measures the rate of taxation as levied by the 16 states with a capital stock tax.
Legislators have come to realize the damaging effects of capital stock taxes, and a handful of states are reducing or repealing them. Kansas completed the phaseout of its tax in West Virginia and Rhode Island fully phased out their capital stock taxes as of January 1, , and Pennsylvania phased out its capital stock tax in The New York capital stock tax will phase out by Illinois will begin a phaseout in , completing the process in Connecticut will phase out its tax over five years starting in States with the highest capital stock tax rates include Connecticut 0.
Maximum Capital Stock Tax Payment. Eight states mitigate the negative economic impact of the capital stock tax by placing a cap on the maximum capital stock tax payment. These states are Alabama, Connecticut, Delaware, Georgia, Illinois, Nebraska, New York, and Oklahoma, and among states with a capital stock tax, they receive the highest score on this variable. Some states mitigate the negative economic impact of the capital stock tax by allowing corporations to pay the higher of their capital stock tax or their corporate tax.
These states Connecticut, Massachusetts, and New York are given credit for this provision. States that do not have a capital stock tax get the best scores in this subindex while the states that force companies to pay both score the worst.
This subindex is composed of dummy variables listing the different types of property taxes each state levies. Seven taxes are included and each is equally weighted. Connecticut, Maryland, and Kentucky receive the worst scores because they impose many of these taxes. Charles Maurice 9 Solution Manual.
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The Cultural Environments Facing Business 3. Emphasizes new concept of global marketing. Fisher, G. Past papers June Question Paper 11 PDF, KB international exposure and a setting to utilise the skills and knowledge they acquired in this particular setting; A platform for the integration of local and international students to enhance diversity and create an international classroom that is directly supportive of the field of study, i.
Dear Mr Jacobs, Thank you very much for your letter 1 5 March. To conclude, we can say that international business is a much broader term and is comprised of both the trade and production of goods and services across frontiers. It should set forth specific objectives and implement a timetable and milestones. Registered Cambridge International Schools can access the full catalogue of teaching and learning materials including papers from to through our School Support Hub.
Fogel, Lawrence Technological University. Phone: toll free or 61 3 3rd edn, Thomson Learning, Victoria. The international business context requires trading and investing in assets denominated in different currencies. Exhibit 1. Emerging market economies EME was a result of international trade activities.
This information gathered in this section relates particularly to the product and brand. Comparative Environmental Frameworks 2. International Business Transactions with Brazil , written by highly experienced experts from both Brazil and the United States, covers most of the topics that a business lawyer in the United States, Europe, or Asia might expect to possibly encounter in his or her representation of International business refers to cross-border trade and investment activities by firms.
Take advantage of this amazing opportunity on stuvera. International Business. International Business: Strategy, Management, and the New Realities Exporting Sale of products or services to customers located abroad, from a base in the home international content is treated in other modules within a particular course. It explain how to serve the oversees market through equity modes and non equity modes. Managing an international business is different than managing a domestic business: 1.
Keywords: international, global. Cultural Frameworks The analogy of an iceberg is useful to conceptualize culture as consisting of different layers. Change the template with unique fillable fields.
Often, there is also a need to understand more about the other nations themselves. It is also a good subject for students from non-business The International Business Ethics Institute is a c 3 private, nonprofit, nonpartisan educational organization that encourages global business practices to promote equitable economic development, resource sustainability, and just forms of government.
Introduction During the latter half of the s, economic analysts became increasingly aware that None.
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