Fiscal Deficit cannot be reduced by increasing Taxes (A point to ponder from Pakistan)
AbstractIn Pakistan the budget deficits have consistently at increasing trend from 1995 to onwards which is being financed by the governments of now and then through external and domestic borrowing which are resulting a high debt levels due to high interest cost associated with it and this all pave the way for an increase in forthcoming taxes levy by the government time to time. This paper is an empirical investigation of the proposition that Fiscal deficit cannot be reduced by increasing taxes. The finding reveals that an increase in taxes is not the better choice for tackling the jinni of fiscal deficit.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 35681.
Date of creation: 2012
Date of revision:
Fiscal deficit; Tax Collection; Error correction model (ECM); ADF unit root test;
Find related papers by JEL classification:
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-01-10 (All new papers)
- NEP-CWA-2012-01-10 (Central & Western Asia)
- NEP-MAC-2012-01-10 (Macroeconomics)
- NEP-PBE-2012-01-10 (Public Economics)
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