Universal Journal of Accounting and Finance Vol. 8(2), pp. 41 - 53
DOI: 10.13189/ujaf.2020.080202
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Tax Wedge Phenomenon and Its Possible Analytical Impacts on the Investments in OECD

Ahmet Niyazi Özker ^*
Public Finance Department, Faculty of Economics and Administrative Sciences, Bandirma Onyedi Eylul University, Turkey

ABSTRACT

In this study, we aim to put forth the tax wedge case that affects both the labor costs and the proposed investment level that also means economic growth through the public decision-making process in an analytical framework. Given that the tax wedge is the proportional difference between the tax paid by a taxpayer worker and the cost to the employer, it is understood that the effect levels also create different differential effects. In this context, it is necessary to question the analytical relationship between the tax wedge and the tax burden. The relationship between this systematic-analytical structural relationship and economic growth also means examining possible externalities in their impact levels. It seems that this effect on OECD countries reveals significant differences according to the development levels of the states. Besides, the breaking point where these differences are substantial in terms of our determinations is the tax burden of nations, and it is understood that the proportional changes in the tax wedge are directly affected by this financial fact. In addition, the fact that OECD countries also have different tax burdens, the differences between tax systems in practice also differentiate the analytical relationship between the tax wedge and tax burdens. However, the measures related to the deviations of global financial and economic relations between OECD countries reveal that possible analytical differences between tax wedge and tax burdens have tried to be overcome via the fundamental systemic financial restructures in recent years.

KEYWORDS
Economic Growth, Labor Costs, OECD, Tax Burden, Tax Wedge

Cite This Paper in IEEE or APA Citation Styles
(a). IEEE Format:
[1] Ahmet Niyazi Özker , "Tax Wedge Phenomenon and Its Possible Analytical Impacts on the Investments in OECD," Universal Journal of Accounting and Finance, Vol. 8, No. 2, pp. 41 - 53, 2020. DOI: 10.13189/ujaf.2020.080202.

(b). APA Format:
Ahmet Niyazi Özker (2020). Tax Wedge Phenomenon and Its Possible Analytical Impacts on the Investments in OECD. Universal Journal of Accounting and Finance, 8(2), 41 - 53. DOI: 10.13189/ujaf.2020.080202.