The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study

The policy of gradual reduction in the corporate tax rate in Malaysia, which commenced since 1988 and continued till today, has become a cause for concern, as the benefits of such reduction have not been established at least empirically. The present study thus investigates the impact of the reductio...

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Main Authors:	Annuar, Hairul Azlan, Isa, Khadijah, Hamdan, Hamdino, Salihu, Ibrahim Aramide, Solarin, Sakiru Adebola
Format:	Conference or Workshop Item
Language:	English
Published:	Kolej Universiti Islam Selangor (KUIS) 2017
Subjects:	HJ2240 Revenue. Taxation
Online Access:	http://irep.iium.edu.my/60831/ http://irep.iium.edu.my/60831/1/Corporate%20Tax%20Ibn%20Khaldun.pdf

id	iium-60831
recordtype	eprints
spelling	iium-608312018-02-04T06:02:27Z http://irep.iium.edu.my/60831/ The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study Annuar, Hairul Azlan Isa, Khadijah Hamdan, Hamdino Salihu, Ibrahim Aramide Solarin, Sakiru Adebola HJ2240 Revenue. Taxation The policy of gradual reduction in the corporate tax rate in Malaysia, which commenced since 1988 and continued till today, has become a cause for concern, as the benefits of such reduction have not been established at least empirically. The present study thus investigates the impact of the reduction of the corporate tax rate on the corporate tax revenue. The study adopts the theory of taxation by Ibn Khaldun – depicted as laffer curve. The analysis of the time series data for period between 1996 and 2014, using the ARDL approach, shows that the corporate tax rate has a dual effect on the corporate tax revenue over the study period. It shows an inverted U-shape relationship between corporate tax rate and corporate tax revenue and further reveals that the optimal tax rate is 25.5156%. Inferentially, a positive relationship existed between the two variables prior to the optimal tax rate and a negative relationship afterward. A further test of causality also shows a long-run unidirectional causality from corporate tax rate to corporate tax revenue. Thus, the policy of the gradual reduction of the corporate tax rate is suspected to have positive impacts on the productivity of Malaysia companies in term of increase in corporate tax revenue. Kolej Universiti Islam Selangor (KUIS) 2017-11-07 Conference or Workshop Item NonPeerReviewed application/pdf en http://irep.iium.edu.my/60831/1/Corporate%20Tax%20Ibn%20Khaldun.pdf Annuar, Hairul Azlan and Isa, Khadijah and Hamdan, Hamdino and Salihu, Ibrahim Aramide and Solarin, Sakiru Adebola (2017) The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study. In: 4th International Conference on Management and Muamalah 2017 (ICoMM 2017), 7 Nov 2017, Putrajaya, Malaysia. (In Press)
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English
topic	HJ2240 Revenue. Taxation
spellingShingle	HJ2240 Revenue. Taxation Annuar, Hairul Azlan Isa, Khadijah Hamdan, Hamdino Salihu, Ibrahim Aramide Solarin, Sakiru Adebola The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study
description	The policy of gradual reduction in the corporate tax rate in Malaysia, which commenced since 1988 and continued till today, has become a cause for concern, as the benefits of such reduction have not been established at least empirically. The present study thus investigates the impact of the reduction of the corporate tax rate on the corporate tax revenue. The study adopts the theory of taxation by Ibn Khaldun – depicted as laffer curve. The analysis of the time series data for period between 1996 and 2014, using the ARDL approach, shows that the corporate tax rate has a dual effect on the corporate tax revenue over the study period. It shows an inverted U-shape relationship between corporate tax rate and corporate tax revenue and further reveals that the optimal tax rate is 25.5156%. Inferentially, a positive relationship existed between the two variables prior to the optimal tax rate and a negative relationship afterward. A further test of causality also shows a long-run unidirectional causality from corporate tax rate to corporate tax revenue. Thus, the policy of the gradual reduction of the corporate tax rate is suspected to have positive impacts on the productivity of Malaysia companies in term of increase in corporate tax revenue.
format	Conference or Workshop Item
author	Annuar, Hairul Azlan Isa, Khadijah Hamdan, Hamdino Salihu, Ibrahim Aramide Solarin, Sakiru Adebola
author_facet	Annuar, Hairul Azlan Isa, Khadijah Hamdan, Hamdino Salihu, Ibrahim Aramide Solarin, Sakiru Adebola
author_sort	Annuar, Hairul Azlan
title	The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study
title_short	The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study
title_full	The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study
title_fullStr	The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study
title_full_unstemmed	The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study
title_sort	positive effect of malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study
publisher	Kolej Universiti Islam Selangor (KUIS)
publishDate	2017
url	http://irep.iium.edu.my/60831/ http://irep.iium.edu.my/60831/1/Corporate%20Tax%20Ibn%20Khaldun.pdf
first_indexed	2023-09-18T21:26:14Z
last_indexed	2023-09-18T21:26:14Z
_version_	1777412209872207872

The positive effect of Malaysia government corporate tax reduction initiative on public listed companies’ revenue: a longitudinal study

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