2023 (20), №3

Analyzing Tax Potential in the Context of Regional Development Initiatives

For citation: 

Rogachev, A. S., Loginov, M. P., & Usova, N. V. (2023). Analyzing Tax Potential in the Context of Regional Development Initiatives. AlterEconomics, 20(3), 663–690. https://doi.org/10.31063/AlterEconomics/2023.20-3.9


This study addresses the challenge of aligning state support, primarily in the form of national projects, with the development of small and medium-sized businesses. The realization of this task, however, is hampered by the existing tax legislation. The aim of this study is to assess the tax potential of a particular region (Sverdlovsk region, Russia) within the broader framework of regional development initiatives. The study relies on a variety of methods, including fiscal, resource-based, institutional, inter-budgetary, productive, reproductive, and transactional methods for assessing the tax potential of the region. Additionally, the study compares these methods and shows the need to expand the theoretical framework to include systemic and investment approaches. The former considers factors such as the regional shadow economy and state influence in assessing the tax base, while the latter focuses on financial capabilities, income sources, and the potential for expanding the tax base. The investment approach aims for a synergetic effect through state subsidies, attracting investments, boosting the gross regional product, and setting the limits for tax potential growth. The article presents findings from modeling the tax potential and assessing its evolution when applying a specially designed subsidized taxation system for Sverdlovsk region. It also offers insights into the anticipated increase in tax revenues for businesses and individual entrepreneurs in Sverdlovsk region resulting from the implementation of this tax system. The findings demonstrate that the implementation of this taxation system, particularly for small businesses, is projected to increase the tax potential of Sverdlovsk region by 2.54 % by 2024 when compared to the baseline year of 2021. These results can serve as a foundation for further research on the accumulation and activation of tax potential in various regions and offer valuable insights for regional authorities in their decision-making processes.

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Alexander S. Rogachev — PhD Student of the Department of Finance, Money Circulation and Credit, Ural State University of Economics (62, 8 Marta St., Ekaterinburg, 620144, Russian Federation; e-mail: alex2014.rogacheff@mail.ru).

Mikhail P. Loginov — Dr. Sci. (Econ.), Associate Professor, Professor of the Department of Finance, Money Circulation and Credit, Ural State University of Economics; http://orcid.org/0000-0003-0831-3004 (62, 8 Marta St., Ekaterinburg, 620144, Russian Federation; e-mail: port-all@mail.ru).

Natalya V. Usova — Cand. Sci. (Econ.), Associate Professor, Associate Professor of the Department of Marketing and International Management, Ural State University of Economics; https://orcid.org/0000-0002-7575-6078 (62, 8 Marta St., Ekaterinburg, 620144, Russian Federation; e-mail: nata-ekb-777@yandex.ru).

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