A longitudinal study of the tax capacity and tax effort of the Malaysian state government

• Main Authors: Abdul Jalil, Ahmad Zafarullah, Harun, Mukaramah, Che Mat, Siti Hadijah
• 格式: Article
• 語言: English
• 出版: World Business Institute, Australia 2012
• 主題: HJ Public Finance
• 在線閱讀: http://repo.uum.edu.my/7393/1/10.Ahmad.pdf; http://repo.uum.edu.my/7393/; http://www.wbiaus.org/wrbr_final2.htm

In Malaysia, the recently launched New Economic Model (NEM) has emphasized the need to review the state-federal fiscal arrangement.It is hoped that through this review, the state government will have a more efficient expenditure programme.However, the model failed to recognize the importance of enhancing the revenue collection system of the state government.Studies have shown that state governments face great difficulties in financing their expenditure needs.And this can be due to the differences in term of their fiscal capacity and fiscal effort.To what extent are the state governments differ in term of these two measures? And how do these measures evolved across time? The main objective of this paper is to measure the effort and capacity of the state governments in Peninsular Malaysia for their land tax for the period of 2000-2008 using the Representative Revenue System (RRS).Our findings show that state governments differ significantly in term of their capacity and their effort.The findings of this study also show that there is little movement in the ranking of the state governments with respect to the level of their tax effort.This implies that state governments especially the ones found to be exerting below average tax effort have shown little initiative to change their effort.This in turn may be due to the way the whole tax system is managed