International Congress on Eurasian Economies

International Conference on Eurasian Economies

5-7 October 2017 – Bishkek, KYRGYZSTAN

Paper detail

Paper ID : 1968
Status : Paper published
Language : English
Topic : Regional Economics
Presenter: Prof. Dr. Naci Tolga Saruç
Session : 3A Sectoral Analysis

The Impact of Tax Apportionment on Fiscal Equalization: A Case Study of Turkish Metropolitan Municipalities
The Impact of Tax Apportionment on Fiscal Equalization: A Case Study of Turkish Metropolitan Municipalities

Abstract

As a monthly basis, 6% of tax revenues collected within provincial borders is allocated by central government as fiscal transfers to 30 metropolitan municipalities of Turkey. These transfers are the most important external revenue of the metropolitan municipalities. The fact that metropolitan cities have a different level of wealth causes the difference between the amounts of taxes collected in the provinces. The lack of tax apportionment policy further increases the disparity of fiscal transfers, since a significant part of major taxes are collected in a few metropolitan cities. In this study, a simulation of tax apportionment is carried out. Taxes and fiscal transfers before and after tax apportionment are compared. Inequality measures (e.g. Gini coefficient) show that fiscal equalization is promoted after tax apportionment.

JEL codes:

Saruç, Naci Tolga, Sağbaş, İsa, Yorulmaz, Recep (2017). "The Impact of Tax Apportionment on Fiscal Equalization: A Case Study of Turkish Metropolitan Municipalities" in Proceedings of International Conference of Eurasian Economies 2017, pp.51-58, Bishkek, KYRGYZSTAN.

DOI: https://doi.org/10.36880/C09.01968

Full paper in PDF format.

Session 3A: Sectoral Analysis

Eurasian Economists Association Kyrgyz-Turkish Manas University Istanbul Beykent University Doğuş University