The managerial benefits of tax compliance: perception by small business taxpayers

Research undertaken in 2006 – 2007 investigated the perception of managerial benefits of tax compliance by small business taxpayers. Survey data from a sample of 300 small business taxpayers and responses to semi-structured interviews of owner managers were examined. The study found that a majority of small business taxpayers recognised that tax compliance activities led to better record keeping and to an improved knowledge of their financial affairs. However, there seemed to be a general reluctance by respondents to accept the idea that benefits could be derived as a result of complying with tax. The findings of this study are important as it is the first research that systematically investigated managerial benefits and their perception by small business taxpayers in Australia.

An empirical investigation of the level effect in Australian interest rates

An extensive literature examines the dynamics of interest rates, with particular attention given to the positive relationship between interest-rate volatility and the level of interest rates—the so-called level effect. This paper examines the interaction between the estimated level effect and competing parameterisations of interest-rate volatility for the Australian yield curve. We adopt a new methodology that estimates elasticity in a multivariate setting that explicitly accommodates the correlations that exist between various yield factors. Results show that significant correlations exist between the residuals of yield factors and that such correlations do indeed impact on model estimates. Within the multivariate setting, the level of the short rate is shown to be a crucial determinant of the conditional volatility of all three yield factors. Measures of model fit suggest that, in addition to the usual level effect, the incorporation of GARCH effects and possible regime shifts is important

Can venous occlusion plethysmography be used to measure high rates of arterial inflow?

To investigate whether venous occlusion plethysmography (VOP) may be used to measure high rates of arterial inflow associated with exercise, venous occlusions were performed at rest, and following dynamic handgrip exercise at 15, 30, 45, and 60 % of maximum voluntary contraction (MVC) in seven healthy males. The effect of including more than one cardiac cycle in the calculation of blood flow was assessed by comparing the cumulative blood flow over one, two, three, or four cardiac cycles. The inclusion of more than one cardiac cycle at 30 and 60 % MVC, and more than two cardiac cycles at 15 and 45 % MVC resulted in a lower blood flow compared to using only the first cardiac cycle (P < 0.05). Despite the small time interval over which arterial inflow was measured (~1 second), this did not affect the reproducibility of the technique. Reproducibility (coefficient of variation for arterial inflow over three trials) tended to be poorer at the higher workloads, although this was not significant (12.7 ± 6.6 %, 16.2 ± 7.3 %, and 22.9 ± 9.9 % for the 15, 30, and 45 % MVC workloads; P=0.102). There was also a tendency for greater reproducibility with the inclusion of more cardiac cycles at the highest workload, but this did not reach significance (P=0.070). In conclusion, when calculated over the first cardiac cycle only during venous occlusion, high rates of FBF can be measured using VOP, and this can be achieved without a significant decrease in the reproducibility of the measurement.

Can students with low vision maintain sustained reading rates?

Purpose: Students with low vision may be disadvantaged when compared with their normally sighted peers, as they frequently work at very short working distances and need to use low vision devices. The aim of this study was to examine the sustained reading rates of students with low vision and compare them with their peers with normal vision. The effects of visual acuity, acuity reserve and age on reading rate were also examined. Method: Fifty-six students (10 to 16 years of age), 26 with low vision and 30 with normal vision were required to read text continuously for 30 minutes. Their position in the text was recorded at two-minute intervals. Distance and near visual acuity, working distance, cause of low vision, reading rates and reading habits were recorded. Results: A total of 80.7 per cent of the students with low vision maintained a constant reading rate during the 30 minutes of reading, although they read at approximately half the rate (104 wpm) compared with their normally sighted peers (195 wpm). Only four of the low vision subjects could not complete the reading task. Reading rates increased significantly with acuity reserve and distance and near visual acuity but there was no significant relationship between age and sustained reading rate. Conclusions: The majority of students with low vision were able to maintain appropriate reading rates to cope in integrated educational settings. Surprisingly only relatively few subjects (16 per cent) used their prescribed low vision devices even though the average accommodative demand was 9 D and generally, they revealed a greater dislike of reading compared to students with normal vision.

Tax morale and direct democracy

This paper analyses the impact of direct democracy on tax morale in Switzerland, a country where participation rights strongly vary across different cantons, using survey data from the International Social Survey Programme (ISSP) 1998. The findings suggest that direct democratic rights have a significantly positive effect on tax morale.

Discount rates in disarray : evidence on flawed goodwill impairment testing

Carlin and Finch, this issue, compare goodwill impairment discount rates used by a sample of large Australian firms with ‘independently’ generated discount rates. Their objective is to empirically determine whether managers opportunistically select goodwill discount rates subsequent to the 2005 introduction of International Financial Reporting Standards (IFRS) in Australia. This is a worthwhile objective given that IFRS introduced an impairment regime, and within this regime, discount rate selection plays a key role in goodwill valuation decisions. It is also timely to consider the goodwill valuation issue. Following the recent downturn in the economy, there is a high probability that many firms will be forced to write down impaired goodwill arising from boom period acquisitions. Hence, evidence of bias in rate selection is likely to be of major concern to investors, policymakers and corporate regulators. Carlin and Finch claim their findings provide evidence of such bias. In this commentary I review the validity of their claims.

An examination of tax-deductible donations made by individual Australian taxpayers in 2007-08

Each year, The Australian Centre for Philanthropy and Nonprofit Studies (CPNS) at Queensland University of Technology (QUT) collects and analyses statistics on the amount and extent of tax-deductible donations made and claimed by Australians in their individual income tax returns to deductible gift recipients (DGRs). The information presented below is based on the amount and type of tax-deductible donations made and claimed by Australian individual taxpayers to DGRs for the period 1 July 2006 to 30 June 2007. This information has been extracted mainly from the Australian Taxation Office's (ATO) publication Taxation Statistics 2006-07. The 2006-07 report is the latest report that has been made publicly available. It represents information in tax returns for the 2006-07 year processed by the ATO as at 31 October 2008. This study uses information based on published ATO material and represents only the extent of tax-deductible donations made and claimed by Australian taxpayers to DGRs at Item D9 Gifts or Donations in their individual income tax returns for the 2006-07 income year. The data does not include corporate taxpayers. Expenses such as raffles, sponsorships, fundraising purchases (e.g., sweets, tea towels, special events) or volunteering are generally not deductible as „gifts‟. The Giving Australia Report used a more liberal definition of gift to arrive at an estimated total of giving at $11 billion for 2005 (excluding Tsunami giving of $300 million). The $11 billion total comprised $5.7 billion from adult Australians, $2 billion from charity gambling or special events and $3.3 billion from business sources.