Research Line: Fiscality

• Objective
• Relevance
• Some publications
• Research team

Objective

The fiscality research line (Leuven section) concentrates on the modelling of the short and long-term effects of changes in real estate fiscality on social prosperity. The end product of the project is a micro-simulation model with which probable trends in the prosperity effects of changes in real estate fiscality can be calculated. In contrast to the traditional ‘arithmetic’ models, an attempt is made to incorporate behavioural effects into the model. The price and income effects are included via the construction of a dynamic query system.
The production of a user interface for the model is beyond the scope of the assignment. The micro-model aims to evaluate distribution and prosperity effects and not primarily an empirical estimation of the tax revenue elasticities, for which macro-data are more suitable.

Discrete choice models study the effect of changes in real estate fiscality on the choice of place of residence. The integration of this latter element into the framework of the simulation model appears to be no simple matter either, and is therefore not provided for in the assignment.

The fiscality research line (Ghent section) studies compliance with regard to Flemish taxes. This study analyses how taxpayers can be induced to pay the taxes that they owe to the tax authorities. This compliance study can be split up into a number of study components.

The study regarding the behaviour of the taxpayer examines when taxpayers convert to non-compliance and what factors induce the taxpayer to tax evasion.
The study regarding the role of third parties explores, inter alia, what role is played by notaries public and brokers in compliance and non-compliance.
The study of the tax authorities focuses on the collection of taxes by the tax authorities and studies whether the audits and penalties that are implemented can be improved.
The study of tax legislation and fiscal policy evaluates the tax regulations and legislation and studies alternative tax bases that also increase compliance. Alternatives will therefore be proposed that fit in with a global outlook on Flemish taxes.

Relevance

The broader Flemish fiscal autonomy requires an instrument that can evaluate the prosperity effects of fiscal policy. The relevant redistribution objectives can only be evaluated properly if the reactions of the citizens to the measures are taken into account.
It is in the interest of the Flemish tax authorities that taxpayers pay the taxes they owe. The compliance study, which fits into the analysis of taxes in Flanders, may lead to recommendations for a reform of Flemish taxes and tax legislation.

Research team

Coördination:

• Carine Smolders (H.Gent)
• Frank Naert (H.Gent)
• Luc Van Ootegem (H.Gent)
• André Decoster (KU Leuven)

Academic researchers:

• Bert Brys (H.Gent)
• Kris De Swerdt (KU Leuven - from 15/12/2003)
• Frederic Vermeulen (KU Leuven 1/1/2003 - 31/9/2003)
• Bart Capéau (KU Leuven 1/11/2001 - 31/12/2002)