Work

Preferential tax treatment – a political or economic tool?

Year: 2021

Type: article

Abstract: This paper investigates whether the scope of preferential tax treatment depends on the political strength of the incumbent mayor. A dataset on real estate taxes in Polish municipalities in 2005–17 is used. More tax revenues are foregone in municipalities governed by politically weak mayors, albeit the uncovered relationship has limited economic significance. It is tentatively found that the preferential tax policy has a slightly negative, if any, effect on municipal revenues. As such, it is rather a political than an economic tool. Less popular mayors offer higher reductions towards natural persons and in the form of tax rate reductions.

Source: Regional Studies

DOI: 10.1080/00343404.2021.1978420

Author: Monika Banaszewska

Institution: Poznań University of Economics and Business

Language: English

Topic: Local Government Finance and Decentralization

Subfield: Political Science and International Relations

Field: Social Sciences

Domain: Social Sciences

SDGs: Peace, justice, and strong institutions, Sustainable cities and communities

Open Access status: green

Funder: Deutscher Akademischer Austauschdienst