Академический Документы
Профессиональный Документы
Культура Документы
By
Sara Mohamed Kheir Ali Mehisy
B.Sc. of Agricultural Economics
University of Khartoum
November 1996
September 2004
To the soul of my father,
to my mother sacrifice,
to my husband,
to my brother
to my sisters.
TABLE OF CONTENTS
Page
Acknowledgements i
Abstract ii
Arabic Abstract iii
REFERENCES 66
APPENDICES
LIST OF TABLES
Fig. Page
Title
B A
P* D
Pp C
0 Q1 Q* Quantity produced
Price
Pc B S+T
P* C A S
0 D+T D
Q Q* Quantity produced
ﺘﻬﺩﻑ ﺍﻟﺩﺭﺍﺴﺔ ﺇﻟﻲ ﺘﻘﻴﻴﻡ ﺃﺜﺭ ﺍﻹﺼﻼﺤﺎﺕ ﺍﻟﻀﺭﻴﺒﻴﺔ ﺨﻼل ﺍﻟﻔﺘـﺭﺓ 2002-1990
ﻋﻠﻰ ﺍﻷﺩﺍﺀ ﺍﻟﺯﺭﺍﻋﻲ ﻭﺍﻹﻴﺭﺍﺩﺍﺕ ﺍﻟﺤﻜﻭﻤﻴﺔ ،ﻭﺒﺼﻭﺭﺓ ﺃﺩﻕ ﻋﻞﻯ ﺇﻨﺘﺎﺝ ﻭﺼﺎﺩﺭ ﺍﻟﻘﻁـﻥ ﻓـﻲ
ﺍﻋﺘﻤﺩﺕ ﺍﻟﺩﺭﺍﺴﺔ ﻋﻠﻰ ﺍﻟﻤﻌﻠﻭﻤﺎﺕ ﺍﻟﺜﺎﻨﻭﻴﺔ ﺍﻟﺘﻲ ﺠﻤﻌﺕ ﻤـﻥ ﻤﺸـﺭﻭﻉ ﺍﻟﺠﺯﻴـﺭﺓ
ﻭﺍﻹﺩﺍﺭﺍﺕ ﺫﺍﺕ ﺍﻟﺼﻠﺔ ﺍﻟﻤﺨﺘﻠﻔﺔ ﺒﺎﻟﺨﺭﻁﻭﻡ.
ﺍﺴﺘﺨﺩﻤﺕ ﺍﻟﺩﺭﺍﺴﺔ ﺘﺤﻠﻴل ﺍﻟﻤﻴﺯﺍﻨﻴﺔ ﻟﺘﻘﻴﻴﻡ ﺍﺜﺭ ﺍﻹﺼﻼﺤﺎﺕ ﺍﻟﻀﺭﻴﺒﻴﺔ ﻋﻠﻰ ﻤﺤﺼـﻭل
ﺍﻟﻘﻁﻥ ﺒﻤﺸﺭﻭﻉ ﺍﻟﺠﺯﻴﺭﺓ.
ﻓﻴﻤﺎ ﻴﺘﻌﻠﻕ ﺒﺎﻹﻴﺭﺍﺩﺍﺕ ﺍﻟﺤﻜﻭﻤﻴﺔ ﻓﻘﺩ ﻭﺠﺩﺕ ﺍﻟﺩﺭﺍﺴﺔ ﺃﻥ ﺍﻹﻴﺭﺍﺩﺍﺕ ﺍﻟﺤﻜﻭﻤﻴـﺔ ﻗـﺩ
ﺍﺯﺩﺍﺩﺕ ﺒﻨﺴﺒﺔ %37ﻨﺘﻴﺠﺔ ﻟﺘﺨﻔﻴﺽ ﻤﻌﺩل ﺍﻟﻀﺭﻴﺒﺔ ﺍﻟﺯﺭﺍﻋﻴﺔ ﻤﻥ %57ﺇﻟﻰ %31ﻋﻨـﺩ
ﻤﺴﺘﻭﻯ ﺍﻟﻤﺯﺍﺭﻉ ﻭﺍﻟﻤﺸﺭﻭﻉ ﻭﺃﺩﺕ ﺇﻟﻰ ﺍﺭﺘﻔﺎﻉ ﻤﺴﺘﻭﻯ ﺇﻨﺘﺎﺝ ﺍﻟﻘﻁﻥ ﺒﻨﺴـﺒﺔ %13ﺨـﻼل
ﻓﺘﺭﺓ ﺍﻟﺩﺭﺍﺴﺔ.
ﻓﻴﻤﺎ ﻴﺘﻌﻠﻕ ﺒﺎﻷﺜﺭ ﻋﻠﻰ ﺍﻟﻤﺯﺍﺭﻉ ﻓﻘﺩ ﺃﻭﻀﺢ ﺘﺤﻠﻴل ﺍﻟﻤﻴﺯﺍﻨﻴﺔ ﺃﻥ ﺍﻟﻀﺭﺍﺌﺏ ﻭﺍﻟﺭﺴﻭﻡ
ﺍﻟﺯﺭﺍﻋﻴﺔ ﻤﻥ ﺘﻜﻠﻔﺔ ﺍﻹﻨﺘـﺎﺝ ﻗـﺩ ﺍﻨﺨﻔـﺽ %55ﻓـﻰ 1995-1990ﺇﻟـﻰ %27ﻓـﻲ
1999-1996ﺜﻡ ﺍﻟﻰ %21ﻓﻲ 2002-2000ﻋﻠﻰ ﺍﻟﺭﻏﻡ ﻤﻥ ﺍﺯﺩﻴﺎﺩ ﻗﻴﻤﺔ ﻫﺫﻩ ﺍﻟﻀـﺭﻴﺒﺔ
ﻨﺘﻴﺠﺔ ﻟﻠﺘﻭﺴﻊ ﻓﻲ ﺍﻟﻤﻭﺍﻋﻴﻥ ﺍﻟﻀﺭﻴﺒﻴﺔ.
ﻭﺠﺩﺕ ﺍﻟﺩﺭﺍﺴﺔ ﺃﻥ ﻫﻨﺎﻟﻙ ﺯﻴﺎﺩﺓ ﻓﻲ ﺘﻜﺎﻟﻴﻑ ﺍﻟﻀﺭﺍﺌﺏ ﻏﻴﺭ ﺍﻟﺭﺴﻤﻴﺔ ،ﻓﻘـﺩ ﺍﺯﺩﺍﺩﺕ
ﻫﺫﻩ ﺍﻟﻀﺭﺍﺌﺏ ﺒﻨﺴﺒﺔ %55ﻭﻴﺘﻭﻗﻊ ﺍﻥ ﺘﻘﻠل ﻤﻥ ﺍﻷﺜﺭ ﺍﻹﻴﺠﺎﺒﻲ ﻟﺘﺨﻔﻴﺽ ﺍﻟﻀﺭﺍﺌﺏ ﺍﻟﺭﺴﻤﻴﺔ.
ﺃﺸﺎﺭﺕ ﻨﺘﺎﺌﺞ ﺍﻟﺘﺠﺭﺒﺔ ﺍﻥ ﺼﺎﺩﺭﺍﺕ ﺍﻟﻘﻁﻥ ﻤﺎﺯﺍﻟﺕ ﺘﻌﺎﻨﻲ ﻤﻥ ﺍﻟﻀﺭﺍﺌﺏ ﻭﺍﻟﺭﺴـﻭﻡ
1.5 Hypothesis
The study hypotheses
1- Reduction/removal of taxes on agriculture increases
farmers’ income.
2- Reduction/removal of taxes on agriculture improves
export and revenue of agricultural commodities.
3- Expansion of tax bates increase government revenue.
2.1 Introduction
Countries need sources of revenue to meet their public
expenditure and to offer public services for the nation such as security,
health and education .The sources of revenue depend on: the type of
Government that is largely involved in improving services to raise the
social standard of living, education structure, international economic
orientation, the level of development and the relation of the country
with the external world (Amara, 2000).
In the Sudan, the main sources of revenue are: Taxation
revenue, Geziera Scheme and other public schemes and corporation
partecepation on the government earnings, Bank’s profits,
Government land fees, fees and taxes on services and other sources.
Taxation is apart of the fiscal policy, and is a financial tool for
economic and social development. Taxation is a compulsory payment
imposed by the Government on the nation to obtain revenue to cover
the public expenditure on social services (Suliman, 1970).
The rate of taxation in the economy of the developed countries
accounts to about 45% of the public revenue. This indicates that
countries depend on taxes as a tool to achieve equity in income
distribution and to achieve stability in the whole economy. Also, taxes
are raised to absorb purchasing power during inflation, reduced to
increase purchasing power during recession.
In underdeveloped countries there are opportunities to achieve
economic stability through investment in physical infrastructure. The
role of taxes in underdeveloped counties is to assist the government by
money needed for development and to affect the socio-economic side
and the welfare in these countries (Mahmoud, 1989).
Since taxation is “a necessary evil” as Kaldor has rightly stated,
it is important to have a good taxing system. A good taxing system
depends on certain rational criterion in line with the basic goals of the
economy.
The primary goals that have acquired general acceptance are
those of efficient resource allocation, full employment with price
stability, a satisfactory income distribution and a high and stable rate
of economic growth.
Traditionally, the role of taxes have been assessed by
economists, since Adam Smith’s, based on four general criteria to
which other special criteria may be added. The four traditional
desirable attributes of a tax system are: (i) allocation efficiency
(ii) equity, (iii) administrative feasibility and (iv) revenue productivity
(Nemiri, 1974).
Financial Objectives
Tax represents the main assured source of revenue for the
government to maintain the financial equilibrium of its public budget.
In the developed countries the rate of direct tax revenue constitutes
a high percentage of the gross domestic product. But in the developing
countries the share of direct tax is very low because it depends
basically on indirect tax.
Social Objectives
There are multiple social objectives for taxes represented in
redistribution of income and wealth, introduction of services,
achievement of equity through redistribution of the tax burden among
the nation. Tax also helps to avoid many bad social habits, such as
smoking cigarettes, by imposing high taxes on its sales or on its
industry.
Economical Objectives
Recently, the economic objective of using taxes is to impose
taxes on consumption, production saving and investment. So the
government uses the tax as a tool to provide incentives for producers
to encourage production of essential goods and services and to provide
disincentives to consumer to deter them from spending on unwanted
goods such as luxuries.
Taxes also protect infant industry in developing countries, it is
increased also to crowd out inflation effect and is reduced during
recession (Elkateep, 1997).
Years Non-taxes
Direct tax Indirect tax Total taxes
return
1990/91 16 51 67 33
1991/92 16 61 77 23
1992/93 28 50 78 22
1993/94 32 52 84 16
1994/95 34 54 88 12
1995 28 54 82 18
1996 29 58 87 13
1997 20 56 76 24
1998 19.6 53.4 73 27
1999 17.3 56.4 73.7 26.
2000 11.5 37 48.5 51.5
2001 11.2 40.3 51.5 48.5
2002 8.7 36.6 45.3 54.7
* Other tax include: capital profits, building tax, added tax and cars license.
Export tax 8
Sub-total 13
Market tax 8
Income tax 1
Zakat 5
Sub-total 15
Sub-total 8
% of Agric.
Agric. Total direct Real value of
Years income tax of CPI
Income tax tax income tax
total direct tax
Hessian
Items Machinery Fertilizer Pesticide Seeds
sacks
Import duties 5 5 5 5 75
Consumption tax - 2 2 2 2
Other taxes 4 2 2 - 4
2.4.4 Zakat
It is a religious levy collected at 5% of crop gross output in case
of irrigated sector and as 10% in case of rain fed sector. The
comparatively law levy rate of the irrigated sector was stipulated to
cater for the high cost of irrigation used in that sector. The higher rate
of 10% was because less manufactured inputs and agricultural
implement usage in the rain fed sector (Soliman, 1970).
2.5 Tax reform
The aims of the tax reform in the Sudan are to: accelerate
regional and international integration of the Sudan economy, follow
the globalization within the concept of world trade organization
(WTO), distribute the tax burden, simplify the tax system through
exempted multiple taxes and fees and to increase the revenue yield of
the government without need for imposing new taxes (Ministry of
Finance and National Economy, 2000).
2.6 Conclusion
The Government in its endeavor to strike a balance between
increasing its budget finances revenue and reducing the tax burden on
agricultural goods and enterprises adopted several tax reforms that did
not fulfill its opted objectives.
CHAPTER THREE
THE CONCEPTUAL FRAMEWORK
AND THE METHODOLOGY
S+T
F B
G H A
E C
0 Q2 Q1 Quantity produced
Local market
Case (1)
Is when the supply curve is inelastic (Fig. 2). Here most of the
tax is passed to the seller (producer) and there is small burden on the
buyer.
Suppose a specific tax (BC) has been imposed on Q, the
imposition of the tax can be shown by the raising the supply curve to
the new one, ST.
The price of the producer is reduced in the new equilibrium
point from P* to Pp. This leads to the reduction of production from Q*
to Q1 as shown by the shift of the supply curve to the left.
Price S+T
S
B
pc
p* C A
Pp O
0 Q1 Q* Quantity produced
External market
Case (3) (export situation)
Is when the export demand curve is perfectly elastic (Fig. 4). In
the case the tax is fully borne by the seller, as there is no way for him
to shift the tax. The extent of excess burden or the loss of producer’s
surplus is shown by the triangle ABC.
B
pc
p* C A
Pp D
0 Q1 Q* Quantity produced
Return
crop A
crop B
Total cost
- Variable cost
- Fixed cost
Gross marginal
revenue
Net profit
3. Net profit
It is obtained by subtracting the estimated total cost of
production of the enterprise from its grass output value (total
revenue).
Total cost = fixed cost + variable cost
Net profit = gross output (total revenue) – total cost
∑ Σ y = y/n Σ x = x/n Σ (y – y) Σ (x – x ) Σ ( y – y )2 Σ ( x – x )2 Σ ( y – y )( x – x )
4.1 Introduction
The objective of this chapter is to estimate the impact of taxe
reforms on improving performance of agriculture and government
revenue and to assess the affect of this tax on farmer incentive. This
chapter in particular indicated the impact of tax policy on cotton
output and return in the Gezira Scheme and on cotton export.
their field performance. The average cost of one feddan of cotton land
were due to the increase in cost of deep ploughing and raising field
tax/kintar
Production and market tax includes: impute duties, production income tax, local and
reserve fees, zakat and other fees.
r = 0.6
5.1 Summary
The importance of this study evolved from the fact that taxes
have an effective role in agricultural performance in Sudan and
government revenue.
Taxes had been reformed during 1990-2002. This study
focused on investigating the impact of tax reforms on cotton
production of the Gezira scheme and export during 1990-2002.
The objective of this study concentrated on the assessment of
farmer incentives for producing cotton using the tax policy reform in
increasing his output and returns.
Also this study aimed at evaluating the effect of tax reforms on
exports cotton during the period of the study and assessment of the
impact of these reforms on government revenue.
Secondary data were collected from different sources
including the Gezira scheme authorities, Gezira scheme office in
Khartoum, Sudan Custom Department, Tax Bureau and Ministry of
Finance and National Economy. Also secondary data was obtained
from Ministry of Foreign Trade, Ministry of Agriculture and forest,
Agricultural Economics Department and from Reports and documents
related to the study.
The analysis of this study was conducted for the periods of
1990-1995, 1996-1999 and 2000-2002. In attempt to achieve the
objective of the study budget analysis were used.
In assessing of the impact of tax reforms on cotton production
and export, the study found that:
- Cotton production cost was very high, specially input cost
which were estimated at about 48%, 45% and 47% of the total
cost during 1990-95, 1996-99 and 2000-2002, respectively.
- Despite of the tax reforms, production tax and fees,
represented high rate of producer marginal return. It was about
57%, 108% and 31%, respectively.
- Production tax and fees still represent high percentage of the
production cost, though, they were reduced from about 55%, 27%
and 21%, respectively.
- There were increases in informal taxes cost by about 55%.
- Import duties were high affecting cost of imported inputs
increasing cost of production during 1990-2002.
- Government return increased as a result of expansion in tax
bates (i.e cotton output).
- In export stage, export tax and fees still represent high rate of
marginal return despite of the tax reforms. It dropped, but still
high, from a level of 79% in 1990-1995 to 35% in 2000-2002.
5.2 Conclusions
Conclusions of the study can be summarized as follows:-
- Despite of the tax reforms, agricultural performances have still
been affected negatively by the existence of taxes and fees.
- Agricultural inputs cost have been increased by import duties,
which led to increase in production cost.
- Although, custom taxes were removed in 2000, cotton export
still experienced some sort of taxes and fees. These exported taxes
were reduced, but still represented high share of marginal revenue
of cotton exports. Therefore, it may be expected that such tax
policy reforms have minimal affect on increasing cotton exports.
- Government tax revenue increased as a result of expansion of
tax bates (i.e cotton out put).
5.3 Recommendations
- All production tax and fees should be reduced particular at
states level so as to ensure positive incentives for cotton
producers.
- Export fees should be removed to enhance cotton
competitiveness in world market.
- The federal government has to supervise and ensure the
implementation of tax removal in all states.
- Custom tariff for inputs should be minimized except that of
the protection purposes.
- All WTO protocols encourage legal legislation clearly
stipulated out in the Sudan Gazette, abolishing administrative,
regulation, rules and laws.
Table 4.1 Variable cost of cotton production for the Gezira
Scheme in SD per feddan during the period 1990/91-2002/03.
Average farm
Season Average cotton Average gross Average
gate price
yield kintar/fed return Sd /fed SD/fe
SD/kintar
Elhori, A.I. (2000). Sudan sesame exports (1992-98): Its support and
implications after Sudan joining WTO (case study: Gedarif
and Elobied sesame producing area). M.Sc. Thesis,
University of Khartoum.
Shoke, F.A.A. (1997). Factor affecting cotton yield in the Gezira Scheme. “A case study of
Rewina area”. M.Sc. Thesis, University of Khartoum.
Yasseen, G.A.M. (2001). Constraints of gum Arabic production and export: A case study
North Kordofan State. M.Sc. Thesis, University of Khartoum.
ﺍﻟﻤﺭﺍﺠﻊ ﺍﻟﻌﺭﺒﻴﺔ
ﺴﻴﺩ ,ﻓﺘﺤﻲ ﺴﻴﺩ ﺍﺤﻤﺩ .(1992) .ﻭﺭﻗﺔ ﻋﻤل ﻋﻥ ﺍﻟﻀﺭﺍﺌﺏ ﺍﻟﺯﺭﺍﻋﻴـﺔ ﻓـﻲ
ﺍﻟﺴﻭﺩﺍﻥ.
Year Export co. Sudan cotton Reserve Sea port co. Standard and
FOB price Custom tax Bales fees
fees co. fees storage fees fees metrology fees
1990 219,574 21,957 2,195 2,195 4,391 1,097 1,097 34,446
1991 168,875 16,887 1,688 1,688 3,277 84 84 23,042
1992 444,765 44,476 4,447 4,447 8,895 2,223 2,223 15,971
1993 699,152 69,915 6,991 6,991 13,983 3,495 3,495 14,407
1994 2,225,724 222,572 22,257 22,257 44,514 11,128 11,128 20,847
1995 6,396,566 639,656 63,965 63,965 128,032 32,742 32,742 18,636
Average 1,692,442 169,244 16,924 16,924 33,849 8,462 8,462 21,225
1996 10,787,882 863,030 107,879 107,879 215,576 53,939 53,939 41,386
1997 14,215,328 1,137,226 142,153 142,153 284,306 71,077 71,077 41,369
1998 17,617,478 1,233,223 176,175 176,175 352,349 88,087 88,087 77,995
1999 10,735,930 536,796 107,359 107,359 214,901 53,680 53,680 92,234
Average 13,339,155 942,569 133,392 133,392 266,783 66,696 66,696 63,246
2000 13,891,474 0 133,814 133,814 267,629 66,907 66,907 153,953
2001 10,826,380 0 108,263 108,263 216,527 54,131 54,131 144,612
2002 15,118,765 0 151,187 151,187 302,375 75,593 75,593 291,333
Average 13,108,872.67 0 131,088 131,088 262,177 65,544 65,544 196,633
Source Sudan Cotton Company