Journal of Knowledge Management, Economics and Information Technology

The principle of tax equity is the most important principle for taxation system design and revision. However, it has tax preference based on consideration of tax collection and social policy. According to Article 14, Category 6 of Individual Income Tax- Self-undertaking in Farming, Fishing, Animal Husbandry, Forestry and Mining, it regulates that the total income is the whole year’s income after deduction of necessary expenses. Furthermore, the necessary expenses are 100% of revenue for whole year based on legal interpretation which is promulgated by Ministry of Finance. Then it has tax preference actually. Nevertheless, it is against principle of tax equity. We analyze formation and development of policy from the perspective of historical literature in this study. We find that it is not exemption on the Self-undertaking in Farming, Fishing, Animal Husbandry, Forestry and Mining initially. Furthermore, it should have space to revise based on consideration of tax collection, social policy and shift of social economic structure. Hence, we propose that government should review that costs and expenses again in order to conform to tax equity.

  The Review of Individual Income Tax- Self-Undertaking in Farming, Fishing, Animal Husbandry, Forestry and Mining: A Perspective of Tax Equity (696.0 KiB, 1,710 hits)

Fiscal policies must ensure the stability of taxes and duties and to propose an optimal level of taxation that does not stop economic activity and do not aggravate the financial situation of the population. Measures concerning taxation system should have the effect of training on tax payers and coordinate proper location and collection of taxes. In the study we aim to achieve reform radiography incomplete and to highlight the challenges raised by taxpayers in Romania by presenting major deficiencies that offset the competitive advantages of the Romanian fiscal system.
Tax legislation should establish legal rules on imposing taxes and penalties for non-compliance with fiscal discipline and conduct training activities in the field of tax payers.
The uncertainty caused by frequency of legislative changes and quality of the relationship with the revenue authorities, including transparency, preparedness and availability are concerns that are found in the current study.
In conclusion, in Romania the share of revenues in GDP is low, although the number of tax administrations is comparable to that of countries with a population twice as large, which confirms once again that the Romanian tax system needs further reform. Its success will be ensured through indirect stimulation of a more sustainable model of economic growth by increasing tax collection to accommodate any potential adjustments of tax system directed specifically towards the incentive to work.

  The Impact of the Economic Crisis upon Fiscal System from Romania and EU Member States (876.3 KiB, 2,124 hits)