Modeling Dynamics System for Real Estate Income Tax in Tabriz Metropolis

Hazrati Leilan, Manouchehr; Bafandeh Zendeh, Alireza; Aali, Samad

doi:10.22096/esp.2021.129545.1361

Modeling Dynamics System for Real Estate Income Tax in Tabriz Metropolis

Document Type : Original Article

Authors

Manouchehr Hazrati leilan ¹

Alireza Bafandeh zendeh ²

Samad Aali ³

¹ Ph.D. Student, Department of Management, Tabriz Branch, Islamic Azad University, Tabriz, Iran.

² Associate professor, Department of Management, Tabriz Branch, Islamic Azad University, Tabriz, Iran.

³ Assistant professor, Department of Management, Tabriz Branch, Islamic Azad University, Tabriz, Iran.

10.22096/esp.2021.129545.1361

Abstract

The present study was conducted aiming to design a model for realization of real estate income tax in Tabriz city with due attention to the procedure of tax collection. For the complexity of the issue system dynamics was selected as the appropriate methodology for modeling. According to the mentioned methodology at first the boundary of the model was investigated. At this stage the key variables were identified including “tax payment”, “real estate”, “tax evasion”, “investment motivation”, “economic rent and speculation in properties”, and “advertisement for tax collection”. At the second stage the interaction among research variables dynamic hypothesis of the study was illustrated using subsystem, casual- loop diagrams and stock- flow map. At the third stage benefiting from related literature and expertise opinion, causality relations were defined in the form of mathematical functions and the model was simulated in Vensim software. After testing the model, applicable scenarios were assessed. The results showed that informing related affairs to tax returns had great effect on paid tax by taxable entities. Tax transparency at the face of taxpayers contributed to reduction in economic rent and tax evasion. Also, analysis of the scenarios showed that in spite of current policies, tax rate reduction through self-declaration increased and resulted in increasing tax revenues.

Keywords

Real Estate Income Tax

Income Tax Jobs

System Dynamics

Economic Rent

Speculation

Sterman, J. (2000), Business Dynamics: Systems Thinking and Modeling for A Complex World. NY,Boston, McGraw-Hill publication..

Izadkhasti, H.(2019) “Analysis of Tax Effects in Property and Housing and Assessing Its Potential Capacity in Iran”, Scientific-Research Journal of Tax Affairs Organization September, 2019. Volume 27, No. 41, pp. 73-103.

Izadkhasti, H .(2019) “Analysis of Tax Effects in Property and Housing and Assessing Its Potential Capacity in Iran”, Scientific-Research Journal of Tax Affairs Organization September, 2019. Volume 14, No. 3, pp.1-25.

Dadkhah, H. (2014). “ Modeling Dynamics System for Land Value Taxation in Iran's Economy”; Journal of Economic Research, Volume 108, NO 49, Autumn 2014, pp:499-522.

Jalali, A. (2017). Reforming the Tax System by Assessing the Feasibility of Applying Tax onRental Income in Iran: Neoclassic Growth Approach, M.A. Thesis, Shahid Behesti University.

Hamidizadeh, G. (2000). “Research Methodology with Thesis Writing Approach”; No. 1, Tehran, Baztab Publications, pp. 21-23.

Maddah, M ., Samiei, , Abu Nouri., I., Shafiee Nikabadi, M., & Samiei, N, (2017). “The Optimized Tax Rates under Tax Rent-Seeking Conditions by using Genetic Algorithm ”. Journal of Tax Research. 2017; Volume 24, No. 32, pp:59-96,

Maddah, M., & Samiei, N .(2019). “The Effect of Financial and Monetary Shocks on the Iranian Taxation System along with Determining Optimal Tax Rates of Consumption, Salary and Wages (General Equilibrium Approach using Genetic Algorithm) Journal of Tax Research; Volume 25, No. 36, pp:177-210

Mahmmodi, Vahideh.,Imamdoost, Mostafa ., Shabanpour., &Pejman Fard, (2017). "An Investigation of Income Convergence in Iran, Emphasizing on Cluster Analysis", Journal of Economic Research and Policies, Volume 27, No 80 ,pp. 241-261.

Iran Direct Tax Law (2002). Publications of Faculty of Economic Affairs, No. 26, Ratified on 16/02/2002.

Nasr Esfahany, Reza., Shahidi, Amaneh., &Momeni, elham.(2011)."Duty on estate, a suitable resource for the finance of public urban areas in Iran (case study: municipality of Isfahan) " Bi-Quarterly Journal of Urban Management, " Volume 1, Special Issue, Number 9,pp.183-201.

Cullis, John., & Jones, Philip (1998). “Public Finance and Public Choice” (2nd ed.), Oxford: Oxford University Press

Iran Direct Tax Law (2015). Publications of Faculty of Economic Affairs, No. 26, Ratified on 16/02/2002.

Iran Direct Tax Law .(2015). Tax Policy (Tax Rates and Bases) Deputy for Research, Planning and International Affairs, Office of Research and Planning.Iran Direct.

Tax Law .(2017). Information Technology Database of the Tax Affairs Organization of East Azerbaijan Province (2014-2017).

Allame Haheri, F., Hortmani, A., &Behrad A(2014). Advertising Impact on Tax Compliance (A case study of Businesses Subject to Paragraph (c), Journal of Tax Research; Volume 22, No. 22, pp:20-53 .

Send comment about this article

Name *

Enter Name.

Email Address *

Enter a valid email address.

Affiliation *

Enter a vaid affiliation.

Comments *

Enter comments (At leaset 10 words)

Security Code *