The Tax Burden and Economic Growth in the Far Eastern Regions

Abstract

The paper deals with the problem of evaluating the tax burden’s adequacy in relation to economic growth at the regional level. The author assesses the tax burden on the basis of the Laffer’s concept through the use of the static three-factor model of E.V. Balatsky. Estimates show that the tax burden in all regions of the Russian Far East held back economic growth in 2011. Forecast results of the Khabarovsky Krai’s fiscal indicators which were obtained by the tools of the SPT Statgraphics (taking into account changes of income tax for large enterprises) demonstrate that the tax burden’s reduction in the region by 2020 will not lead to economic growth’s stimulation

Keywords

• tax burden
• economic growth
• the Laffer’s concept
• fiscal analysis
• fiscal indicators
• fiscal tolerance
• fiscal climate
• profit tax
• the Russian Far East