Fiscal Policy, Prices, Inflation - Dependencies and Interdependences

  • Ileana Iulia Istudor Valahia University of Targoviste, Targoviste
  • Florina Mocanu Valahia University of Targoviste, Targoviste, Romania
Keywords: inflation, value added tax, indirect tax, purchasing power, fiscal policy

Abstract

The phenomenon called inflation is a complex problem of macroeconomic analysis and is one of the most important forms of the economic and social imbalance. Inflation is the persistent and significant growth process of the price level. Also, inflation can be defined by a decrease in purchasing power of a monetary unit, respectively of the quantity of goods and services that can be purchased with the help of a monetary unit. Thus, inflation leads to the distortion of the ratio between the nominal and the real value, with the effect of reducing the purchasing power of money. Through taxation, the State can gain from inflation in its capacity as the tax collector. In the case of indirect taxes, which are found in the sales prices of products and services, any increase in them directly affects their level. The intent of this article is to highlight the dependencies and interdependencies that may exist between fiscal policy, prices and inflation. Period under study extends over six years, from 2013 to 2018. The processed data are for Romania and have been extracted from the National Bank of Romania and National Institute of Statistics reports.

References

Istudor II, Mocanu F. L'impact de la TVA sur les prix en Roumanie. Revue Valaque d'Etudes Economiques. 2016;7(3):39-46. Available from: http://www.rvee.eu/index.php/archives/93-2015/125-volume-7-no3.html

Moşteanu T. Preţuri, echilibru concurenţial şi bunăstare socială. Bucharest: Economică; 2001. 336 p.

Croitoru L. Cercul vicios al politicii fiscale- Available from: http://www.bnr.ro/files/d/Pubs_ro/Studii/LC20140209.pdf

Socol AG, Socol C. Estimarea mecanismelor de stabilizare fiscală automată. Cazul României, Economie Teoretică şi Aplicată. 2012;3(568):13-25. Available from: http://store.ectap.ro/ articole/695_ro.pdf

Georgescu F. Conţinutul şi calitatea politicii fiscale în pas cu evoluţia şi obiectivele societăţii româneşti. 2017. Available from: http://www.opiniibnr.ro/index.php/politica-monetara/236-continutul-si-calitatea-politicii-fiscale-in-pas-cu-evolutia-si-obiectivele-societatii-romanesti

Bryan M, Cecchetti S. Measuring core inflation, monetary policy. Chicago: The University of Chicago Press; 1994. 219 p.

Rich R, Steindel C. A comparison of measures of core inflation. Economic Policy Review. 2007;13(3):19-36. Available from: https://ssrn.com/abstract=1072923 DOI: 10.2139/ssrn.1072923

National Bank of Romania. publicaţii periodice. 2018. Available from: http://www.bnr.ro/Publicatii-periodice-204.aspx

Romanian Parliament. Law no. 227/2015 regarding the Fiscal Code. Monitorul Oficial al României. 2015;688.

National Institute of Statistics. Consumer price index - Monthly, databases and statistical metadata. 2018. Available from: http://statistici.insse.ro/shop/?page=ipc1〈=ro

National Bank of Romania. Report over inflation [2018 August]. XIV(53):46-68.

European Commission. Romania's Country Report. Bruxelles; 2018. Available from: https://ec.europa.eu/info/sites/info/files/2018-european-semester-country-report-romania-ro.pdf

Published
2019-08-01