The incentive purpose of tax expenditures in terms of tax collection in Morocco: case of companies’ tax
The basic principle of the concept of “tax expenditures” is based on a process made up of two essential elements, namely the payment of the tax that would have entered the state budget, if the tax provision did not exist, and the expenditure. Of the tax granted in favor of the beneficiary up to the reduction provided for by the special provision. Indeed, the tax expenditure reduces the tax revenue of the state through the reduction of the tax payable by the taxpayer. It is this tax reduction that is behind the incentive of economic agents to change their behavior and thus contributes to achieving the objectives desired by the public authorities. However, when the taxpayer, for one reason or another, manages to reduce or not pay the tax, the incentive effect of the tax advantage becomes ineffective. In this context falls the objective of this article, which aims to shed light on the impact of the payment of tax on the incentive effect of tax expenditures. The results show that the more the taxpayer pays less or does not pay tax, the lower or even zero the incentive effect of tax expenditures, and vice versa.
Copyright (c) 2020 Khalid Hossni, Karima Touili
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