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Article: Elasticity and buoyancy of federal taxes in Pakistan.(Report)
- Article from:
- Pakistan Development Review
- Article date:
- June 22, 1986
- Author:
CopyrightCOPYRIGHT 1986 Reproduced with permission of the Publications Division, Pakistan Institute of Development Economies, Islamabad, Pakistan. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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This paper focuses on the revenue-expenditure activities of the federal government and evaluates the performance of the fiscal system on the basis of estimates of revenue productivity. Two methodologies for the estimation of the short-run and long-run elasticity and buoyancy for tax revenue are evaluated. It is found that the Divisia Index method is superior on both theoretical and practical grounds and the results obtained are substantiated by the proportional--adjustment method. The study finds that the built-in elasticity of Pakistan's tax system was greater than unity.
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