Stabilising State Budget Revenues Via Indirect Taxation
DOI:
https://doi.org/10.31150/ajebm.v7i11.3084Keywords:
indirect taxation, value-added tax, revenue stability, state budget, fiscal policy, tax revenue volatility, mixed-methods analysis, economic resilienceAbstract
This article investigate the impact of indirect taxation on the stability of state budget revenues, a pressing concern amid global economic uncertainty. Indirect taxes, including value-added tax (VAT) excise duties, and customs tariffs, play a crucial role in sustaining government revenue, particularly during periods of economic downturn or market volatility. This study aims to assess the effectiveness of indirect taxes as reliable revenue sources compared to direct taxes, which are often more sensitive to economic fluctuations. Using a quantitative research approach, this analysis draws on time-series data across multiple economic cycles to evaluate the correlation between indirect tax revenue and fiscal stability in various economic contexts. The results demonstrate that indirect taxes, notably VAT, exhibit a more consistent revenue pattern, contributing significantly to budget resilience. Findings suggest that an increased reliance an VAT and other indirect taxes could mitigate fiscal risks associated with economic instability, thereby enhancing budget stability. These insights underscore the importance of indirect tax reforms and policy adjustments to maximize revenue potential while minimizing the economic burden on lower-income populations. Policy recommendations include diversifying indirect tax bases and refining tax collection processes to optimize state budget stability.
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