Browsing by Subject "Taxes"

Now showing 1 - 4 of 4
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    Competition between non-profit and for-profit health insurers.
    (J Health Econ, 1983-12) Adamache, KW; Sloan, FA
    This study investigates the effects of tax, regulatory, and reimbursement policies and other factors exogenous to the health insurance market on the relative price (to commercial insurers) paid by Blue Cross plans for hospital care, their administrative expense and accounting profits, premiums, and ultimately Blue Cross market share. We specify and estimate a simultaneous equation model to assess interrelationships among these variables. We conclude that premium tax advantages enjoyed by the Blues have virtually no effect on the Blues' premiums or their market shares. A Blue Cross plans' market share has a positive effect on the discount it obtains from hospitals as does coverage of Blue Shield charges by a state-mandated rate-setting plan. An upper bound on the effect on the Blue Cross market share of covering Blue Cross under rate-setting but excluding the commercials from such coverage is seven percentage points. Tests for administrative slack in the operation of Blue Cross plans yield mixed results.
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    Illicit cigarette consumption and government revenue loss in Indonesia.
    (Global Health, 2014-11-19) Ahsan, Abdillah; Wiyono, Nur Hadi; Setyonaluri, Diahhadi; Denniston, Ryan; So, Anthony D
    BACKGROUND: Illicit cigarettes comprise more than 11% of tobacco consumption and 17% of consumption in low- and middle-income countries. Illicit cigarettes, defined as those that evade taxes, lower consumer prices, threaten national tobacco control efforts, and reduce excise tax collection. METHODS: This paper measures the magnitude of illicit cigarette consumption within Indonesia using two methods: the discrepancies between legal cigarette sales and domestic consumption estimated from surveys, and discrepancies between imports recorded by Indonesia and exports recorded by trade partners. Smuggling plays a minor role in the availability of illicit cigarettes because Indonesians predominantly consume kreteks, which are primarily manufactured in Indonesia. RESULTS: Looking at the period from 1995 to 2013, illicit cigarettes first emerged in 2004. When no respondent under-reporting is assumed, illicit consumption makes up 17% of the domestic market in 2004, 9% in 2007, 11% in 2011, and 8% in 2013. Discrepancies in the trade data indicate that Indonesia was a recipient of smuggled cigarettes for each year between 1995 and 2012. The value of this illicit trade ranges from less than $1 million to nearly $50 million annually. Singapore, China, and Vietnam together accounted for nearly two-thirds of trade discrepancies over the period. Tax losses due to illicit consumption amount to between Rp 4.1 and 9.3 trillion rupiah, 4% to 13% of tobacco excise revenue, in 2011 and 2013. CONCLUSIONS: Due to the predominance of kretek consumption in Indonesia and Indonesia's status as the predominant producer of kreteks, illicit domestic production is likely the most important source for illicit cigarettes, and initiatives targeted to combat this illicit production carry the promise of the greatest potential impact.
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    Tax-Based Collateral Limitations, Borrowing Arrangements and Firm Value
    (2019) Hills, Robert

    I examine a tax-related friction that limits U.S. multinational corporations’ ability to use foreign assets as collateral in obtaining U.S. debt financing. I find that tax-based collateral limitations are associated with reduced debt capacity and higher borrowing costs. Additionally, I show that collateral limitations are associated with a decrease in the use of capital covenants and an increase in the use of performance covenants in private debt agreements. While the U.S. House and Senate passed versions of the Tax Cuts and Jobs Act of 2017 that included provisions to eliminate tax-based collateral limitations, the final version surprisingly retained these limitations. I find a negative relation between the extent to which a firm is affected by tax-based collateral limitations and market reactions around the passage of the final version of the Act, suggesting tax-based collateral limitations constrain borrowing arrangements and thereby reduce firm value. The costs associated with these collateral limitations offer one explanation for the under-sheltering puzzle, which suggests firms fail to take advantage of the supposed benefits of tax avoidance strategies.

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    The empirical analysis of cigarette tax avoidance and illicit trade in Vietnam, 1998-2010.
    (PLoS One, 2014) Nguyen, Minh Thac; Denniston, Ryan; Nguyen, Hien Thi Thu; Hoang, Tuan Anh; Ross, Hana; So, Anthony D
    Illicit trade carries the potential to magnify existing tobacco-related health care costs through increased availability of untaxed and inexpensive cigarettes. What is known with respect to the magnitude of illicit trade for Vietnam is produced primarily by the industry, and methodologies are typically opaque. Independent assessment of the illicit cigarette trade in Vietnam is vital to tobacco control policy. This paper measures the magnitude of illicit cigarette trade for Vietnam between 1998 and 2010 using two methods, discrepancies between legitimate domestic cigarette sales and domestic tobacco consumption estimated from surveys, and trade discrepancies as recorded by Vietnam and trade partners. The results indicate that Vietnam likely experienced net smuggling in during the period studied. With the inclusion of adjustments for survey respondent under-reporting, inward illicit trade likely occurred in three of the four years for which surveys were available. Discrepancies in trade records indicate that the value of smuggled cigarettes into Vietnam ranges from $100 million to $300 million between 2000 and 2010 and that these cigarettes primarily originate in Singapore, Hong Kong, Macao, Malaysia, and Australia. Notable differences in trends over time exist between the two methods, but by comparison, the industry estimates consistently place the magnitude of illicit trade at the upper bounds of what this study shows. The unavailability of annual, survey-based estimates of consumption may obscure the true, annual trend over time. Second, as surveys changed over time, estimates relying on them may be inconsistent with one another. Finally, these two methods measure different components of illicit trade, specifically consumption of illicit cigarettes regardless of origin and smuggling of cigarettes into a particular market. However, absent a gold standard, comparisons of different approaches to illicit trade measurement serve efforts to refine and improve measurement approaches and estimates.