Academic literature on the topic 'Sources of revenue'

The oil sector that eased the financial constraint of Nigerian government in the 1970s is presently acting as the source of financial constraints to the country due to a continuous decline in government revenue, arising from the recent drastic fall in world crude oil prices. This calls for the government to diversify its revenue base through improving taxation. This study examined the influence of economic performance on the government revenue as well as the various sources of tax revenues in Nigeria. Monthly data spanning 1999 to 2016 were utilized to estimate vector error correction models (VECM) for five sources of government tax revenues based on data availability. Empirical results revealed that there is a significant relationship between real GDP and real company income tax revenues, and between real GDP and real excise duty revenues in the long run. However, in the short run, the one-year lag of tax revenue varieties poses a significant influence on the various sources of tax revenues.

Ineffectiveness of states has been linked to poor fiscal-social contract between states and her citizens which is a consequence of how states raise her revenues. Hence, this paper examines the relative impacts of earned and unearned revenues on different measures of state effectiveness in terms of provision of basic public goods and development of economic and political institutions in Nigeria over the period 1996 to 2018, using Autoregressive Distributive Lag (ARDL) estimation technique. The paper found that, on one hand, an increase in earned revenue instigates improvement in provision of health care, while increase in unearned revenue had no significant impact on provision of health. On the other hand, a one-percent (1%) increase in earned revenue had a greater impact on educational enrollment than a 1% increase in unearned revenue. Increase in earned revenue increases state effectiveness while increase in unearned revenue reduces state effectiveness. The paper concludes that, the effectiveness of Nigerian government in provision of basic public goods and development of strong economic and political institutions might improve if government increases their financial resources through taxes than increase in oil revenue.

Cities require well-funded public infrastructure to function efficiently, but knowledge of public finance mechanisms among residents and decision makers may be deficient. This paper presents a thorough investigation of infrastructure funding flows to increase understanding, to catalyze further investigation in other jurisdictions, and to identify best practices. By using data from Waterloo, Ontario, Canada, funding was mapped for the four tiers of government—federal, provincial, regional, and municipal—contributing to infrastructure. The results demonstrate that significant opacity exists around municipal reserve funds and intergovernmental transfers because insufficient recording is associated with the origin revenues of these funds: where moneys first enter the government cycle. To compare across infrastructure systems, funding from each tier was used to find an average revenue share and estimated per capita funding per source for the water system and three transportation systems: auto, transit, and active transportation. Water infrastructure was funded through six origin revenue sources, with user fees and development charges funding 95% of expenditures. For transportation infrastructure, the auto system was funded through 16 origin revenue sources, transit through 13, and active transportation through seven. The auto and active transportation systems were 75% funded through mixtures of property tax, user fees, and development charges. The transit system received significant contributions from nonregional revenue sources because of capital projects developed in the study period. Active transportation, water, and parking expenditures are shown to use effective revenue sources, while transit and other auto expenditures used less effective sources because of the wide range of origin revenue sources.

Collection of local own source in a decentralized economy is a huge challenge for town administrations in developing countries. The resultant of which is poor service delivery and infrastructural management due to collapses of local economic conditions.In the light of worldwide developed and developing countries scenario this study comprehends the ideology of collection of local own source revenue in Town Municipal Administration Murree and its aftermaths on the local economy.This study has explored all the major sources of revenue in Town Municipal Administration Murree and has identified a clear relation and dependency of internal and external sources of revenue. The research determined that the Town Municipal Administration is mostly dependent on property taxes and financial grants from the provincial government to meet its needs. For unexplored local own source revenues introduction of the property tax in the form of capital gain tax and infrastructure development tax as a major part of the internal own source revenues. For external own source revenue compensation in the form of environmental degradation tax due to positive externalities of the areas tourism capacities should also be introduced. There is no collaboration in the public and private sector for reinforcement of the local economy. It has also been concluded that there is no integrated policy for taxation and revenue generation in the local government

Received wisdom argues that citizens more readily demand accountability from government for taxes than for nontax revenue from oil or foreign aid, giving rise to an important mechanism underlying the “resource curse,” which posits that nontax revenue causes citizen quiescence and hampers government accountability. However, in developing countries, obfuscation through value-added taxes and strong popular feelings of ownership over all revenues may minimize differences across revenue sources. Identical experiments on representative samples of Ghanaians and Ugandans, and similar experiments on members of parliament, probe the effects of different sources and delivery channels of government revenues on citizens’ actions to monitor governments and members of parliament (MPs’) beliefs about accountability pressures. Roughly half of all citizens take action to monitor all 3 sources. However, neither Ghanaians nor Ugandans demand more accountability for taxes than oil or aid when the revenues go to the government. MPs likewise saw no difference. Citizens do differentiate between aid money given to nongovernmental organizations (NGOs) compared with revenues delivered to the government. Findings are robust to numerous alternatives and subgroups. Against strong expectations from prior research, little evidence exists showing that taxes strengthen citizens’ demands for accountability or that MPs perceive differences across revenue sources in these 2 representative African countries. However, aid channeled through NGOs motivates more accountability pressures.

Purpose Australia’s Future Tax System (2009) among its recommendations identified the need for realignment of tax revenue across the tiers of government in Australia, as well as the need to raise additional revenue from land-based taxes. In achieving these objectives, this paper aims to examine the revenues generated from land and how capital gains tax may be reconceptualised as a value capture tax resulting from the rapid urbanisation of Australia’s cities. The development of a theoretical framework realigns the emerging rationale of a value capture tax, as a means for revenue to be divested from central government in the form of capital gains, to sub-central government as a value capture tax. Design/methodology/approach A qualitative research methodology comprising grounded theory and phenomenological research is used in undertaking the review of tax revenue collection from state land tax, conveyance stamp duty, local government rating and Commonwealth capital gains tax. Grounded theory is applied for constant comparison of the data with the objectives of maximising similarities and differences in these revenues with an analytical construct as defined by Strauss and Corbin (1990, p. 61). Findings The paper finds that realigning revenue from land-based taxes against the principles of good tax design provides greater opportunity to raise additional revenue to fund public infrastructure while decentralising revenue from central government. It provides an alternate mechanism for revenue transfer from central to sub-central government while conceptually improving own source revenue from value capture taxation as a new revenue source. Research limitations/implications The limitation of this paper is the ability to quantify the potential increase that would be generated in the form of value capture revenue. It is demonstrated in the paper that capital gains tax took over 15 years for revenue generation to crystallise, a factor that would likely occur in the potential introduction of a value capture tax for funding transport infrastructure. Practical implications The pathway to introducing a value capture tax is through re-innovating capital gains tax as a value capture tax directly hypothecated to funding transport infrastructure that results in the uplift in values of the surrounding property from which revenue is raised. Originality/value This paper provides a new approach in contributing to funding the capital outlay of public infrastructure in lieu of central government consolidated revenue allocated through the Commonwealth Grants Commission. It provides a much-needed approach to decentralising revenue from the Commonwealth to sub-central government in Australia which has one of the most centralised tax systems in the OECD.

Purpose: The purpose of this study was to establish the factors affecting revenue collection in Nairobi City County Government.Methodology: The study adopted a descriptive research design. The study population comprised of a total of 340 members of staff working as chief officers, technical staff and members of Nairobi City County assembly. The sample size was determined using the Fischer’s formula. The sample size for the study was 180 which was distributed proportionately among the strata. The study used a survey questionnaire as a research instrument. Data collected was analyzed with the help of SPSS by both descriptive and inferential statistics. The results were presented in form of tables and graphs. The study adopted a multivariate regression.Results: The study found that revenue diversification affect revenue collected through number of sources of revenue and new policies to a great extent. Tax administration affects revenue in Nairobi City County through competent staff, availability of computers, and availability of postal communication system and tax education. Tax structure affects revenue collection through flexibility, equitability, neutrality and simplicity while different forms of revenue (property, business license) affect amount of revenue collected. Revenue diversification had a positive and significant relationship with amount of revenue collected whereas different forms of revenue collected had positive and significant effect on amount of revenue collected in Nairobi City County.Unique contribution to theory, practice and policy: The study recommends on the use of latest technology and competent staff in tax administration, also there should be more innovations to have diversified sources of revenues in Nairobi City County in order to collect more revenue. The financial managers and policy makers in Nairobi City County assembly should come up with new sources of revenues and taxes that obey the canon law of taxation that is economical, simple, flexible and easy to administer.

Local own-source revenue is one of the sources of revenue for the government of Medan. This revenue is used to accelerate the development of the city of Medan, especially in the infrastructure development section. A better infrastructure will help in the implementation of business operations that support the improvement of community welfare. One source of local revenues is the local tax revenue. The community service was conducted to optimize the revenue of Medan through optimizing the value of taxable object. This community service supported the government of Medan medium term plan program. This service was carried out with briefing methods, workshops, and mentorings. Science and technology given include work ethic, effective communication, and taxable object valuation. The results of this community service were satisfactory. There was a significant change in the attitude of partners while updating the data. As the results, the community as the owner of taxable object becomes more cooperative and the updating data goes better.

AbstractNontax revenues make up a substantial amount of government revenue around the world, though scholars usually focus on individual sources of such revenue (for example, foreign aid and state-owned oil companies). Using a theory of regime change that builds on recent models of the redistributional foundations of dictatorships and democracies, I generate hypotheses regarding all nontax revenue and regime stability. I argue that an increase in nontax revenue should be associated with less taxation of elites in democracies, more social spending in dictatorships, and more stability for both regime types. I find support for all three of these hypotheses in a cross-sectional time-series analysis, covering all countries and years for which the necessary data are available. Significantly, I show that the particular source of nontax revenue does not make a difference: they all act similarly with regard to regime stability and the causal mechanisms.

Municipalities to develop their policies use Local taxes, fees and charges for empower of these potential sources of revenue: local tax autonomy makes collection more efficient and enables municipalities to introduce their own measures of social policy. These sources of income also increase the responsibility of local authorities: Among the various fees, charges and income tax, property tax has become an important source of funding for local costs. In most cases, the various taxes on immovable property- together with other forms of taxes property- established in the new fiscal framework of modern local governments. The fiscal autonomy of local governments is largely defined by the volume of their own sources of income. Own revenue sources limit the dependence of municipalities from intergovernmental transfers and revenues that the municipalities receive from the national budget. I will try to explain hanges made from the decentralization process in Macedonia throught ten years of starting implementation of the decentralization on property tax collection.

Transportation funding is critical to maintaining the assets that provide mobility for the movement of Georgia's people and goods. Currently, most of Georgia's transportation revenue is provided by the motor fuel tax. Inflation and recent increases in fuel economy have decreased fuel tax revenue in Georgia and weakened the Georgia Department of Transportation's (GDOT)'s ability to maintain and expand its transportation network. This thesis synthesizes factors from literature that affect motor fuel tax revenue. These include demographic, economic, technological, and environmental forces that influence travel behavior and vehicle fuel economy. A model was then created that incorporated these factors to model GDOT's 2009 fuel tax revenue and then project revenue in 2020 and 2030. The model uses an input/output structure that segments the fleet into personal, freight, and transit categories. User inputs, historical data, and projections are linked via relationships and feedback loops to project travel and fuel tax revenue forward. Because a near-infinite number of scenarios exist, conservative and aggressive scenarios were created for 2020 and 2030 scenarios that output revenue on an absolute, per-mile, and per-capita basis for comparison with more recent revenues. The model outputs predict marginal declines in revenue by 2020 and significant declines by 2030. In response to these declines, the thesis evaluates methods of increasing transportation revenue. These methods include increasing the fuel tax, incorporating a VMT-fee, and widespread tolling measures. After evaluation, a policy recommendation is provided for how to best implement revenue strategies.

The purpose of the study was to investigate the effectiveness of state lotteries as sources funding for public elementary and secondary education. The population consisted of 39 executive directors from state school board associations and the District of Columbia.A questionnaire of 22 items addressing lottery adoption, operation, performance, revenue dedication and distribution, proponent expectations, and school board member expectations was utilized. The questionnaire focused upon seven basic research questions.Findings1. Legislators in twenty-two states formally approved state lotteries between 1971 and 1989.2. Thirteen (fifty-nine percent) of twenty-two state lotteries in operation were approved by state legislatures between 1985 and 1989.3. Proponents in fifteen (73 percent) of adopting states cited "benefits to special interest groups" as an adoption rationale.4. Legislatures in four states dedicated 100 percent of lottery revenues to public elementary and secondary education.5.Fiscally successful lotteries have effective marketing and good organization/structure.6. The fiscal success of lotteries was limited by a multitude of factors, none of which represented more than 27 percent of responses.7. Measurement of lottery revenues to education was difficult due to the methods of distribution, and sparse data.8. Four of six state lotteries have revenues dedicated to education distributed funds through equalization grants.9. Lottery revenues met or exceeded the expectations of 81 percent of proponents.10. Lottery revenues to education met the expectations of 22 percent of school board members.11. Proponents in states where a lottery had been considered but not adopted cited each of three rationales 65 percent of the time. The rationales were: 1) lottery participation is voluntary, unlike a tax, 2) lotteries raise state revenue without raising taxes, and 3) benefits to special interest groups.12.Opponents in states where the legislature had considered but not adopted a lottery cited the rationale "lotteries are morally wrong" 100 percent of the time.

Nontraditional revenue is the term used to describe sources of funding other than those provided by federal and state support, including grants, and those provided by local property tax levies. Examples included licensing agreements, advertising in school facilities and on school property, school business partnerships, booster clubs, education foundations, and user fees. The purpose of this study was (1) to identify the sources of nontraditional revenue used by Indiana school corporations and Indiana high schools, (2) to assess local school officials' attitudes and expectations regarding the use of nontraditional revenue, and (3) to provide some insight as to how Indiana school corporations and schools utilize those funds.A QUAN-Qual Model was used for this study. The QUAN-Qual Model enabled the researcher to conduct the study in two phases. The first phase was comprised of a survey instrument used to identify the kinds of nontraditional revenue being used and to collect data regarding the amounts of nontraditional revenue being generated. The instrument was also used to measure attitudes towards nontraditional revenue and the perceived importance of those funds. The second phase was comprised of qualitative data collection through telephone interviews with school corporation and high school administrators conducted in February and March 2006. Analysis and interpretation of that data provided additional information about attitudes towards nontraditional revenue and how those funds are used.All Indiana school corporations and high schools that were included in the study utilized nontraditional revenue sources to varying degrees. They supplemented traditional funding with licensing agreements, school-business partnerships, booster clubs, education foundations, individual donations, and user fees. Nontraditional sources of revenue were identified as being essential for supporting some activities and programs. However, the researcher's sampling of corporation level administrators' and high school principals' attitudes regarding that revenue suggested that neither group relied on it to provide for essential personnel or programs. Statistically significant data suggest that school corporations and schools located in rural settings might be at a disadvantage with respect to their capacity to generate nontraditional revenue.
Department of Educational Leadership

Although nonprofit organization (NPO) leaders play crucial roles in society, financial distress and vulnerability are common for many NPO leaders, with some NPOs closing as a result of these conditions. The purpose of this single-case study was to explore the diversification strategies used by 10 leaders and senior staff of an NPO in the mid-Atlantic region of the United States through the conceptual lens of Markowitz's modern portfolio theory. Data were collected through in-depth semistructured interviews and analysis of organizational documents, internal archival data, social media, literature, and online databases. Through thematic analysis, 7 revenue diversification themes emerged: adding revenue streams; establishing an operating reserve; establishing positive financial performance; achieving financial stability, sustainability, organizational capacity, and organizational resilience; using transparency; achieving efficiency and organizational effectiveness; and using a marketing strategy. Additionally, 7 key themes emerged: documenting and implementing systematic processes, developing an approach to process improvement, implementing cross-department action plans, increasing transparency, reversing the adverse trend in forum participation, building a data-management system, and increasing individual and organizational capacity. These findings have implications for positive social change, in that they may offer NPO executives new insights and strategies to support revenue diversification, thereby helping them to reduce volatility in funding, decrease financial risk, avoid dependence on sole-source revenue, and identify opportunities to increase flexibility in support of organizational goals and objectives to increase services.

The public's demand for accountability will have a significant impact on research universities' revenue resources in the future. Driving the demand is a perceived lack of institutional productivity. Undergraduate students' graduation rates represent one product of public research universities. States have already latched onto these rates as a measure of institutional performance; and as a result, states have provided a basis for public research universities to use the relationship between dollars invested in the institution and undergraduate students' graduation rates to respond to accountability issues. Current research provides little insight into this relationship. Research in this study uses concepts from the higher education production function, the resource dependency theory, and the Principal-Agent Model to investigate undergraduate students' four-year and six-year graduation rates as an institutional product. The research provides a greater degree of transparency into the relationship between dollars invested in public research universities and undergraduate students' graduation rates than has previously been shown. As a result of this relationship analysis, the research enables the development of a model for predicting undergraduate student graduation rates relative to dollars invested in the institution from different sources.

Doutoramento em Ciências Sociais
Socio-economic changes, alterations in societal expectations and new public policies have put pressures on higher education public funding, bringing the issue of funding diversification to the forefront. Income diversification, namely, generation of funds from private, as well as from competitive public sources, has become increasingly important in European higher education due to a complex financial environment and perceived deficit of innovation transfer. Although there are numerous studies about changes in national funding systems and allocation mechanisms, few have focused on diversification of funding sources, especially in the European context, making Portugal no exception. Thus, this study aims at exploring income diversification at the institutional level and its influence on the internal organisational structures. For this purpose two Portuguese public universities were chosen as case studies. The empirical material was collected through semi-structured interviews with top management and middle management of each university and through documentary analysis. Data analysis demonstrated that both universities are in the process of institutionalizing and formalising practices of income diversification, notably by getting more professional in how they are dealing with external stakeholders, such as businesses, local community, and students. However, the study also revealed that there is no formal, organised strategy to deal with income diversification. In general, the universities are reacting to external demands rather than pro-actively exploring opportunities. In this respect, the analysis determined several factors that promote or inhibit income diversification activities. Quality and favourable organizational culture were named by the interviewees as the most relevant factors for successful income diversification. External factors such as legal arrangements and funding conditions were cited as major constraints. This research has also revealed that revenue diversification activities tend to develop along the continuum towards higher sophistication and systematisation of activities that are supported by a powerful infrastructure. Together with efforts at the institutional level, the role of government policies proves to be crucial in providing tools and incentives to higher education institutions and creating a harmonious higher education system.
As mudanças socioeconómicas, as alterações nas espectativas sociais e novas políticas públicas têm posto uma enorme pressão sobre o financiamento público do ensino superior, trazendo a questão da diversificação do financiamento para o primeiro plano. Diversificação de financiamento, nomeadamente, a geração de receitas próprias de fundos provados, bem como de financiamento competitivo público, tornou-se cada vez mais importante no ensino superior Europeu, devido a um ambiente financeiro complexo e a défice de transferência de inovação. Embora existam numerosos estudos sobre mudanças nos sistemas nacionais de financiamento do ensino superior e mecanismos da distribuição do mesmo, poucos têm-se centrado na questão de diversificação das fontes de financiamento, especialmente no contexto Europeu e também em Portugal. Assim, este estudo pretende explorar a diversificação de financiamento ao nível institucional e sua influência sobre as estruturas organizacionais das universidades. Para este efeito, duas universidades públicas Portuguesas foram escolhidas como estudos de caso. Os dados foram recolhidos através de entrevistas semi-estruturadas com membros de Reitoria e Diretores de Departamentos e Faculdades, bem como da análise documental. A análise de dados mostrou que ambas as universidades encontram-se em processo de institualização e formalização de práticas de diversificação de financiamento, nomeadamente ficando mais profissionais em lidar com agentes externos, tais como as empresas, a comunidade local e os estudantes. No entanto, o estudo também revelou que não há uma estratégia formal, organizada para lidar com a diversificação de financiamento. Em geral, as universidades estão a responder a procura externa, em vez de explorar pró-activamente as oportunidades. Em relação a isto, a análise de dados determinou vários fatores que promovem ou inibem atividades de diversificação de financiamento. Qualidade e cultura organizacional favorável foram nomeadas pelos entrevistados como os fatores mais relevantes a diversificação de financiamento bem-sucedido. Fatores externos, como enquadramento jurídico e condições de financiamento foram citados como principais constrangimentos. O estudo também revelou que as atividades de diversificação de fontes de financiamento tendem a desenvolver ao longo do continuum em direção a maior sofisticação e sistematização das atividades suportadas por uma infraestrutura sólida. Juntamente com os esforços a nível institucional, o papel das políticas governamentais prova ser crucial no fornecimento de ferramentas e incentivos para as instituições do ensino superior e a criação de um sistema de ensino superior harmonioso.

The purpose of this study was to determine how public two-year colleges in Tennessee internally budgeted and expended their unrestricted educational and general (E&G) funds from fiscal years 1988-89 through 1997-98. The primary focus was on the 14 Tennessee Board of Regents (TBR) community colleges and the internal allocation of expenditures by function from 1988-89 through 1997-98. A limited functional expenditure comparison was made with data from the National Association of College and University Business Officers' (NACUBO) comparative financial analysis for fiscal years 1993-94 and 1994-95 as well as with the Integrated Postsecondary Education Data System (IPEDS) survey for the 1996-97 fiscal year. The study examined whether the TBR community colleges were apportioning a larger percentage of their budgets for direct instruction and less for administrative support services in 1997-98 versus 1988-89. The analysis also examined staffing patterns relative to FTE enrollment, changes in revenue patterns for the four major sources of unrestricted E&G funds, and tuition increases. A portion of the analysis included comparisons between current and constant dollars to measure the real gain or loss in financial resources after allowing for inflation as measured by the Consumer Price Index (CPI). A primary research question underlying this study sought to determine if the public two-year colleges in Tennessee were operating more efficiently at the end of the research period regarding the internal allocation of budgeted funds. It was assumed that efficiency could be measured in terms of an increase in the percentage allocation of funds to direct instruction and a decrease in the percentage allocated to institutional support for general administration. In spite of a reduction in the share of state appropriations provided to higher education during the past decade, the TBR community colleges apportioned a larger percentage of their budgets for instructional cost in 1997-98 than in 1988-89. Conversely, these colleges expended a smaller portion of their budgets for administration at the end of the ten-year period. In conclusion to this study, recommendations are made to more effectively inform public policymakers and the general public as to the efficiency of Tennessee's public community colleges regarding the allocation of financial resources. Comparisons with national and Southern Regional Education Board data are also desirable. Public policymakers are encouraged to more critically examine the long-range benefits of an educated population and the forecast for technical skills required of the workforce in the 21st century.

This thesis focuses on deaf people’s educational attainment, position on the labour market and sources of revenue. These issues are interrelated, for instance a higher level of educational attainment seems to be associated with a lower unemployment rate and higher levels of income. The national context is Sweden and the Swedish welfare state in 2005. All studies in the thesis compare a deaf population, consisting of 2,144 persons born between 1941 and 1980 who have attended a school for the deaf in Sweden, with a general reference population, consisting of 100,000 randomly chosen persons from the total Swedish population born between 1941 and 1980. Data for all studies consisted of registered information about the persons in the year 2005. The results show that there are differences between the deaf and the reference population regarding level of educational attainment, position on the labour market and sources of revenue and disposable income, with the deaf population having a poorer position than the reference population in all areas. There are also differences between the workplaces of the deaf and the people in the reference population, and it is twice as common for people in the deaf population than for people in the reference population to have a higher level of educational attainment than is required for their occupation. These differences between the deaf and the reference population cannot be associated with differences in the independent factors, as for instance sex, age and immigration background, for which the results have been adjusted. This thesis shows that being part of the deaf population appears to be of importance. Factors in conjunction with deafness that can increase our understanding of the differences between the deaf and the reference populations in an educational context, labour market context and economic context are discussed in the thesis.

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The Federal Government, giving efficacy to section III of  4 of art. 153 of the Federal Constitution enacted Law No. 11,250, of december 27, 2005, which provides that the Union, through an agreement, delegate responsibility for monitoring and collection for the Municipalities and the Federal District on the Rural Land Tax (ITR). By adhering to the agreement, the cities appropriated the entire revenue of ITR, paying, however, with the cost of administering them. Without membership, municipalities receive the transfer equivalent to 50% of the proceeds. This study aims to evaluate the potential of revenue collection ITR considering various scenarios of tax administration costs, serving as a resource for decision-making of the city manager about the adherence agreement with the Union For this, we used data agricultural census 2006 for 184 municipalities in the Cearà linear regression model of OLS. As a result, it was found that characteristics such as the Gini index, the total area of establishments (crop, pasture, woods and forests, agroforestry and so residual) value of goods and livestock area of influence on the collection of ITR. It is presented as a consequence, the potential revenue collection of the tax to municipalities on the basis of the Cearà cost scenarios considered.
O Governo Federal, dando eficÃcia ao inciso III do  4 do art. 153 da ConstituiÃÃo Federal, editou a Lei n 11.250, de 27 de dezembro de 2005, que prevà a possibilidade de a UniÃo, por meio de convÃnio, delegar competÃncia de fiscalizaÃÃo e arrecadaÃÃo para os MunicÃpios e o Distrito Federal, quanto ao Imposto Territorial Rural (ITR). Ao aderirem ao convÃnio, os municÃpios apropriam a totalidade da receita de ITR, arcando, porÃm, com os custos de administrÃ-los. Sem a adesÃo, os municÃpios recebem o repasse equivalente a 50% do arrecadado. Este trabalho tem como objetivo avaliar o potencial arrecadatÃrio do ITR, considerando diversos cenÃrios de custos de administraÃÃo do tributo, servindo como subsÃdio para a tomada de decisÃo do gestor municipal acerca da adesÃo ao convÃnio com a UniÃo. Para tanto, utilizou-se dados do Censo AgropecuÃrio 2006, para os 184 municÃpios Cearenses, em modelo de regressÃo linear de mÃnimos quadrados ordinÃrios. Como resultado, constatou-se que caracterÃsticas como o Ãndice de Gini, a Ãrea total dos estabelecimentos (lavoura, pastagem, matas e florestas, sistema agroflorestal e de forma residual), valor dos bens e Ãrea de produÃÃo animal exercem influÃncia sobre a arrecadaÃÃo do ITR. Apresenta-se, como consequÃncia, o potencial arrecadatÃrio do tributo para os municÃpios Cearenses em funÃÃo dos cenÃrios de custos considerados.

Abstract A key source of revenue for the media and entertainment domain is ad targeting: serving advertisements to a select set of visitors based on various captured visitor traits. Compared to global media companies such as Google and Facebook that aggregate data from various sources (and the privacy concerns these aggregations bring), local companies only capture a small number of (high-quality) traits and retrieve an unbalanced small amount of revenue. To increase these local publishers’ competitive advantage, they need to join forces, whilst taking the visitors’ privacy concerns into account. The EcoDaLo consortium, located in Belgium and consisting of Adlogix, Pebble Media, and Roularta Media Group as founding partners, aims to combine local publishers’ data without requiring these partners to share this data across the consortium. Usage of Semantic Web technologies enables a decentralized approach where federated querying allows local companies to combine their captured visitor traits, and better target visitors, without aggregating all data. To increase potential uptake, technical complexity to join this consortium is kept minimal, and established technology is used where possible. This solution was showcased in Belgium which provided the participating partners valuable insights and suggests future research challenges. Perspectives are to enlarge the consortium and provide measurable impact in ad targeting to local publishers.

Abstract “Alternative Revenue Sources” are tipping fee revenues received from the combustion of non-traditional waste. Such alternative solid wastes are not hazardous wastes and are not typically delivered by the normal garbage collection system. Alternative Revenue Wastes (ARW) need a due diligence review showing that disposal of the waste will not violate any laws, ordinances and/or permit conditions. Disposal of ARW will need coordination and additional special handling for final disposal ARW generators do pay a tipping fee greater than the solid waste tipping fee in order to compensate the owner/operator for the extra effort. ARW wastes are derived from the following special considerations: 1) Liability concerns from disposal of such waste. 2) Sensitive security. 3) Legal/Regulatory compliance. 4) Environmental concerns. 5) Resource recovery. 6) Infectious Wastes.

The accounting rules related to revenues’ recognition and measurement have not been changed for many years, and have been listed in International Accounting Standard 18 – Revenues, which has been in use since 1984. Practice has shown that the standard is no longer an adequate basis for revenue recognition and therefore the International Accounting Standards Board (IASB) in cooperation with American FASB has created and published a new accounting standard that addresses the issue of revenue recognition – IFRS 15 – Revenues from Contracts with Customers. This standard supersedes the application of IAS 18 as of January 1, 2018. Since revenue is a very important element in determining the profit or loss of an entity and therefore its performance, preparers of financial statements should pay full attention to accounting principles related to revenues’ recognition and measurement while preparing financial statements. New accounting standard for revenues introduces certain innovations in the field of revenue calculation as well as in time of revenues’ recognition. These changes will have a significant impact on the amount of revenues for certain industries, such as the telecommunications and construction industry, which have significant share of revenues from contracts with customers. The aim of the research is to identify the challenges and problems that appears in the initial phase of application of a new standard on revenues such as; the need to consider a larger volume of documentation, inadequate existing IT infrastructure, multiple sources of documentation that must be considered in revenue recognition, including commercial, legal and financial documentation etc. In addition, we plan to identify benefits form the application of the new standard for the entities preparing the financial statements. In this context, it is expected to identify the sectors that have the most dilemmas in the application of this standard and to propose potential solutions to address these problems.

The purpose of this research is to find out how the contribution of Hotel Taxes in increasing the Regional Original Income of Medan City and what are the efforts in increasing the hotel tax. Sources of data used in this research are secondary data, namely in the form of targets and realization of hotel tax revenue and realization of local revenue Medan City from 2016 to 2018. The data analysis technique used in this study is to use descriptive analysis. Hotel Tax to Local Own Revenue is to compare the actual value of Hotel Tax with the realization of Local Own Revenue in Medan City. The results show that in 2016-2018, the contribution of Hotel Tax in the city of Medan increased every year. In contrast to the contribution, the value of the realization of Regional Original Income tends to fluctuate because, in 2016-2017, it increased, while in 2018, the realization value decreased.

The aim of this study is to evaluate environmental taxation in the Baltic States (Estonia, Latvia, Lithuania). First, environmental policies and environmental tax reforms of these countries will be generally overviewed. After addressing the legal regulations related environmental taxation, the composition of environmental taxes, the share of environmental taxes in total tax revenue and GDP will be put forward. In the light of these indicators, the situation of the Baltic countries in EU will be assessed. The reports of the European Commission, Eurostat database, and OECD Database on instruments used for environmental policy are the main data sources used in the study. According to Eurostat data for 2014, energy taxes take the largest share from environmental taxes in EU. While Lithuania has the highest share of energy taxes (93,78%) in EU, Estonia has the lowest share of transport taxes (2,12%). Latvia ranks fifth in terms of the share of environmental taxes in total tax revenue (9.16%). Estonia is among in top ten countries with a share of 8,22%. The share of Lithuania (6.06%) remains slightly below average.

Abstract Petroleum product needs to be stored and transported from various sources before they get to the final consumers, there by requiring storage tanks. Calibration of storage tank by dry and wet strapping process have evolved over the years with state-of-the-art facilities. The calibration charts are used to determine and know the volume of fluid in a tank given the height of the petroleum products stored in the tank. Calculating volume of a tank with the integration method has a lot of sources of error thereby affecting the result of the volume calculated and causing losses in revenue due to inaccurate calibrated tanks. With the losses in revenue due to wrong computations or computational errors, a fast, dynamic and cost-effective solutions become imperative to solve these computation problems. The tank charts having been delivered for daily usage and fiscalization process after the tank strapping process, calculation errors need to be minimized in order to report accurately petroleum products in stocks, which is a function of temperature, density and volume correction factor. This paper aims to solve the problem by semi automating the process of calculating total volume of product in stock with error free results. Approach in this paper was used and test run for a storage facility X. This paper shows how calculations from calibrated tanks can be done with a virtual method using excel spreadsheet and converted into a software for effective use and making percentage error almost zero. The results obtained from this method of computation were error free and devoid of human errors.

This paper discusses the merits of merging SCADA1 and gas measurement from a technical and economical perspective. Because traditional SCADA is largely limited to control room data used only for day to day operational purposes, the real-time metering data is not often utilized in the external revenue-generation business systems of the organization. In many cases, entirely separate measurement systems are utilized in isolation which often have few, if any, ties to the SCADA system which is capable of collecting pertinent measurement information. Measurement data validation provides automatic data validation of flow measurement data upon retrieval from telemetered or non-telemetered data sources. Row measurement data can be supplied from field devices such as electronic flow computers or from other sources of flow measurement data such as manual operator entry, third party collection systems, chart integration sources, etc. Flow measurement data undergoes a series of automated validation tests including single-run limit checking, meter run comparisons (at a given metering station) and historical validation tests (such as searching for frozen values). The outcome of these tests determines the data quality code assigned to each flow measurement reading (indicating the results of validation tests). When combined with a real-time processing and data acquisition engine in a SCADA system that is capable of communicating with field devices via leased lines, VSAT, radio, dial-up, etc., many benefits can be realized.

Recently the dispatch priority of renewable energy sources is getting higher due to CO2 reduction policies [2]. This reduces operating time and revenue for Gas Turbine Combined Cycle (GTCC) plants. Upgrade programs for GTCC give a financial benefit and global CO2 reduction by the effective use of renewables [1]. The knowledge of Original Equipment Manufacturers (OEMs) can improve the performance and reliability according to user requirements. Mitsubishi Hitachi Power System (MHPS) developed upgrade programs utilizing advanced technology to improve performance for existing F class GTCC units. The F4 technology performance upgrade is a program to increase performance by turbine cooling air reduction. It can be applied to both 50 Hz and 60 Hz engines under the scale design rule. The upgrade development was completed with verification at commercial plants. The expected performance enhancement was achieved successfully. This paper describes our approach and verification results for user’s asset value enhancement.

The Indiana Department of Transportation maintains 17 rest area locations with 28 separate rest area facilities located on interstates for driver safety and convenience. Although the rest areas provide many benefits to the traveling public, the rest areas do not earn direct profits. Moreover, the Indiana Department of Transportation is increasingly challenged by inadequate funding from taxes generated on the interstates. Constrained by Title 23, that prohibits the commercialization and the privatization of the rest areas, the state of Indiana has a high interest in sustainable sources of revenue at the rest areas that would be able to promote the states and facilities tourism and commerce. The benefits that can be recognized by taking up this project are (i) higher revenues for the INDOT (ii) cost savings wherever possible (iii) environmental benefits (iv) better services and safety measures for overnight travelers (v) partnerships with local businesses.

Nigeria has sought to diversify its economy away from dependence on oil as a major source of government revenue through agricultural commercialisation. Agriculture has been a priority sector because it has very high growth potential and the greatest potential for employment and export revenue. The cocoa and rice value chains are central to the government’s engagement with agriculture to achieve these objectives. This paper sets out to investigate the underlying political economy dynamics of the commercialisation of the cocoa and rice value chains in Nigeria in terms of smallholder farm households’ shift from semi-subsistence agriculture to production primarily for market, and predominantly commercial medium- and large-scale farm enterprises complementing or replacing smallholder farm households.

Flooding is a major source of concern for Texas’ coastal communities. It affects the quality of infrastructure, the lives of citizens, and the ecological systems upon which coastal communities in Texas rely. To plan for and mitigate the impacts of flooding, Texas coastal communities may implement land use tools such as zoning, drainage utility systems, eminent domain, exactions, and easements. Additionally, these communities can benefit from understanding how flooding affects water quality and the tools available to restore water bodies to healthy water quality levels. Finally, implementing additional programs for education and ecotourism will help citizens develop knowledge of the impacts of flooding and ways to plan and mitigate for coastal flooding. Land use tools can help communities plan for and mitigate flooding. Section III addresses zoning, a land use tool that most municipalities already utilize to organize development. Zoning can help mitigate flooding, drainage, and water quality issues, which, Texas coastal communities continually battle. Section IV discusses municipal drainage utility systems, which are a mechanism available to municipalities to generate dedicated funds that can help offset costs associated with providing stormwater management. Section V addresses land use and revenue-building tools such as easements, eminent domain, and exactions, which are vital for maintaining existing and new developments in Texas coastal communities. Additionally, Section VI addresses conservation easements, which are a flexible tool that can enhance community resilience through increasing purchase power, establishing protected legal rights, and minimizing hazardous flood impacts. Maintaining good water quality is important for sustaining the diverse ecosystems located within and around Texas coastal communities. Water quality is regulated at the federal level through the Clean Water Act. As discussed in Section VII, the state of Texas is authorized to implement and enforce these regulations by implementing point source and nonpoint source pollutants programs, issuing permits, implementing stormwater discharge programs, collecting water quality data, and setting water quality standards. The state of Texas also assists local communities with implementing restorative programs, such as Watershed Protection Programs, to help local stakeholders restore impaired water bodies. Section VIII addresses ecotourism and how these distinct economic initiatives can help highlight the importance of ecosystem services to local communities. Section VIX discusses the role of education in improving awareness within the community and among visitors, and how making conscious decisions can allow coastal communities to protect their ecosystem and protect against flooding.

Millions of dollars are involved in high-speed rail (HSR) infrastructure construction and maintenance. Large-scale projects like HSR require funding from a variety of avenues beyond those available through public monies. Although HSR serves the general public’s mobility needs, any funds (whether State or Federal) flowing from the public exchequer usually undergo strict review and scrutiny. Funds from public agencies are always limited, making such traditional financing mechanisms unsustainable for fulfilling HSR’s long-term operational and maintenance cost needs—on top of initial costs involved in construction. Therefore, any sustainable means of financing HSR projects would always be welcome. This research presents an alternate revenue generation mechanism that could be sustainable for financing HSR’s construction, operation, and maintenance. The methodology involves determining key HSR stations, which, after development and improvement, could significantly add value to businesses and real estate growth. Any form of real estate taxes levied on properties surrounding such stations could substantially support the HSR project’s funding needs. In this research, a bi-objective optimization problem is posed in conjunction with a Pareto-optimal front framework to identify those key stations. With 28 California HSR stations used as an example, it was observed that the four proposed HSR stations in Fullerton, Millbrae-SFO, San Francisco Transbay Terminal, and San Diego would be excellent candidates for development. Their development could increase the economic vitality of surrounding businesses. The findings could serve as valuable information for California HSR authorities to focus on developing key stations that would generate an alternate funding source for an HSR project facing funding challenges.

1.1 Macroeconomic summary Economic recovery has consistently outperformed the technical staff’s expectations following a steep decline in activity in the second quarter of 2020. At the same time, total and core inflation rates have fallen and remain at low levels, suggesting that a significant element of the reactivation of Colombia’s economy has been related to recovery in potential GDP. This would support the technical staff’s diagnosis of weak aggregate demand and ample excess capacity. The most recently available data on 2020 growth suggests a contraction in economic activity of 6.8%, lower than estimates from January’s Monetary Policy Report (-7.2%). High-frequency indicators suggest that economic performance was significantly more dynamic than expected in January, despite mobility restrictions and quarantine measures. This has also come amid declines in total and core inflation, the latter of which was below January projections if controlling for certain relative price changes. This suggests that the unexpected strength of recent growth contains elements of demand, and that excess capacity, while significant, could be lower than previously estimated. Nevertheless, uncertainty over the measurement of excess capacity continues to be unusually high and marked both by variations in the way different economic sectors and spending components have been affected by the pandemic, and by uneven price behavior. The size of excess capacity, and in particular the evolution of the pandemic in forthcoming quarters, constitute substantial risks to the macroeconomic forecast presented in this report. Despite the unexpected strength of the recovery, the technical staff continues to project ample excess capacity that is expected to remain on the forecast horizon, alongside core inflation that will likely remain below the target. Domestic demand remains below 2019 levels amid unusually significant uncertainty over the size of excess capacity in the economy. High national unemployment (14.6% for February 2021) reflects a loose labor market, while observed total and core inflation continue to be below 2%. Inflationary pressures from the exchange rate are expected to continue to be low, with relatively little pass-through on inflation. This would be compatible with a negative output gap. Excess productive capacity and the expectation of core inflation below the 3% target on the forecast horizon provide a basis for an expansive monetary policy posture. The technical staff’s assessment of certain shocks and their expected effects on the economy, as well as the presence of several sources of uncertainty and related assumptions about their potential macroeconomic impacts, remain a feature of this report. The coronavirus pandemic, in particular, continues to affect the public health environment, and the reopening of Colombia’s economy remains incomplete. The technical staff’s assessment is that the COVID-19 shock has affected both aggregate demand and supply, but that the impact on demand has been deeper and more persistent. Given this persistence, the central forecast accounts for a gradual tightening of the output gap in the absence of new waves of contagion, and as vaccination campaigns progress. The central forecast continues to include an expected increase of total and core inflation rates in the second quarter of 2021, alongside the lapse of the temporary price relief measures put in place in 2020. Additional COVID-19 outbreaks (of uncertain duration and intensity) represent a significant risk factor that could affect these projections. Additionally, the forecast continues to include an upward trend in sovereign risk premiums, reflected by higher levels of public debt that in the wake of the pandemic are likely to persist on the forecast horizon, even in the context of a fiscal adjustment. At the same time, the projection accounts for the shortterm effects on private domestic demand from a fiscal adjustment along the lines of the one currently being proposed by the national government. This would be compatible with a gradual recovery of private domestic demand in 2022. The size and characteristics of the fiscal adjustment that is ultimately implemented, as well as the corresponding market response, represent another source of forecast uncertainty. Newly available information offers evidence of the potential for significant changes to the macroeconomic scenario, though without altering the general diagnosis described above. The most recent data on inflation, growth, fiscal policy, and international financial conditions suggests a more dynamic economy than previously expected. However, a third wave of the pandemic has delayed the re-opening of Colombia’s economy and brought with it a deceleration in economic activity. Detailed descriptions of these considerations and subsequent changes to the macroeconomic forecast are presented below. The expected annual decline in GDP (-0.3%) in the first quarter of 2021 appears to have been less pronounced than projected in January (-4.8%). Partial closures in January to address a second wave of COVID-19 appear to have had a less significant negative impact on the economy than previously estimated. This is reflected in figures related to mobility, energy demand, industry and retail sales, foreign trade, commercial transactions from selected banks, and the national statistics agency’s (DANE) economic tracking indicator (ISE). Output is now expected to have declined annually in the first quarter by 0.3%. Private consumption likely continued to recover, registering levels somewhat above those from the previous year, while public consumption likely increased significantly. While a recovery in investment in both housing and in other buildings and structures is expected, overall investment levels in this case likely continued to be low, and gross fixed capital formation is expected to continue to show significant annual declines. Imports likely recovered to again outpace exports, though both are expected to register significant annual declines. Economic activity that outpaced projections, an increase in oil prices and other export products, and an expected increase in public spending this year account for the upward revision to the 2021 growth forecast (from 4.6% with a range between 2% and 6% in January, to 6.0% with a range between 3% and 7% in April). As a result, the output gap is expected to be smaller and to tighten more rapidly than projected in the previous report, though it is still expected to remain in negative territory on the forecast horizon. Wide forecast intervals reflect the fact that the future evolution of the COVID-19 pandemic remains a significant source of uncertainty on these projections. The delay in the recovery of economic activity as a result of the resurgence of COVID-19 in the first quarter appears to have been less significant than projected in the January report. The central forecast scenario expects this improved performance to continue in 2021 alongside increased consumer and business confidence. Low real interest rates and an active credit supply would also support this dynamic, and the overall conditions would be expected to spur a recovery in consumption and investment. Increased growth in public spending and public works based on the national government’s spending plan (Plan Financiero del Gobierno) are other factors to consider. Additionally, an expected recovery in global demand and higher projected prices for oil and coffee would further contribute to improved external revenues and would favor investment, in particular in the oil sector. Given the above, the technical staff’s 2021 growth forecast has been revised upward from 4.6% in January (range from 2% to 6%) to 6.0% in April (range from 3% to 7%). These projections account for the potential for the third wave of COVID-19 to have a larger and more persistent effect on the economy than the previous wave, while also supposing that there will not be any additional significant waves of the pandemic and that mobility restrictions will be relaxed as a result. Economic growth in 2022 is expected to be 3%, with a range between 1% and 5%. This figure would be lower than projected in the January report (3.6% with a range between 2% and 6%), due to a higher base of comparison given the upward revision to expected GDP in 2021. This forecast also takes into account the likely effects on private demand of a fiscal adjustment of the size currently being proposed by the national government, and which would come into effect in 2022. Excess in productive capacity is now expected to be lower than estimated in January but continues to be significant and affected by high levels of uncertainty, as reflected in the wide forecast intervals. The possibility of new waves of the virus (of uncertain intensity and duration) represents a significant downward risk to projected GDP growth, and is signaled by the lower limits of the ranges provided in this report. Inflation (1.51%) and inflation excluding food and regulated items (0.94%) declined in March compared to December, continuing below the 3% target. The decline in inflation in this period was below projections, explained in large part by unanticipated increases in the costs of certain foods (3.92%) and regulated items (1.52%). An increase in international food and shipping prices, increased foreign demand for beef, and specific upward pressures on perishable food supplies appear to explain a lower-than-expected deceleration in the consumer price index (CPI) for foods. An unexpected increase in regulated items prices came amid unanticipated increases in international fuel prices, on some utilities rates, and for regulated education prices. The decline in annual inflation excluding food and regulated items between December and March was in line with projections from January, though this included downward pressure from a significant reduction in telecommunications rates due to the imminent entry of a new operator. When controlling for the effects of this relative price change, inflation excluding food and regulated items exceeds levels forecast in the previous report. Within this indicator of core inflation, the CPI for goods (1.05%) accelerated due to a reversion of the effects of the VAT-free day in November, which was largely accounted for in February, and possibly by the transmission of a recent depreciation of the peso on domestic prices for certain items (electric and household appliances). For their part, services prices decelerated and showed the lowest rate of annual growth (0.89%) among the large consumer baskets in the CPI. Within the services basket, the annual change in rental prices continued to decline, while those services that continue to experience the most significant restrictions on returning to normal operations (tourism, cinemas, nightlife, etc.) continued to register significant price declines. As previously mentioned, telephone rates also fell significantly due to increased competition in the market. Total inflation is expected to continue to be affected by ample excesses in productive capacity for the remainder of 2021 and 2022, though less so than projected in January. As a result, convergence to the inflation target is now expected to be somewhat faster than estimated in the previous report, assuming the absence of significant additional outbreaks of COVID-19. The technical staff’s year-end inflation projections for 2021 and 2022 have increased, suggesting figures around 3% due largely to variation in food and regulated items prices. The projection for inflation excluding food and regulated items also increased, but remains below 3%. Price relief measures on indirect taxes implemented in 2020 are expected to lapse in the second quarter of 2021, generating a one-off effect on prices and temporarily affecting inflation excluding food and regulated items. However, indexation to low levels of past inflation, weak demand, and ample excess productive capacity are expected to keep core inflation below the target, near 2.3% at the end of 2021 (previously 2.1%). The reversion in 2021 of the effects of some price relief measures on utility rates from 2020 should lead to an increase in the CPI for regulated items in the second half of this year. Annual price changes are now expected to be higher than estimated in the January report due to an increased expected path for fuel prices and unanticipated increases in regulated education prices. The projection for the CPI for foods has increased compared to the previous report, taking into account certain factors that were not anticipated in January (a less favorable agricultural cycle, increased pressure from international prices, and transport costs). Given the above, year-end annual inflation for 2021 and 2022 is now expected to be 3% and 2.8%, respectively, which would be above projections from January (2.3% and 2,7%). For its part, expected inflation based on analyst surveys suggests year-end inflation in 2021 and 2022 of 2.8% and 3.1%, respectively. There remains significant uncertainty surrounding the inflation forecasts included in this report due to several factors: 1) the evolution of the pandemic; 2) the difficulty in evaluating the size and persistence of excess productive capacity; 3) the timing and manner in which price relief measures will lapse; and 4) the future behavior of food prices. Projected 2021 growth in foreign demand (4.4% to 5.2%) and the supposed average oil price (USD 53 to USD 61 per Brent benchmark barrel) were both revised upward. An increase in long-term international interest rates has been reflected in a depreciation of the peso and could result in relatively tighter external financial conditions for emerging market economies, including Colombia. Average growth among Colombia’s trade partners was greater than expected in the fourth quarter of 2020. This, together with a sizable fiscal stimulus approved in the United States and the onset of a massive global vaccination campaign, largely explains the projected increase in foreign demand growth in 2021. The resilience of the goods market in the face of global crisis and an expected normalization in international trade are additional factors. These considerations and the expected continuation of a gradual reduction of mobility restrictions abroad suggest that Colombia’s trade partners could grow on average by 5.2% in 2021 and around 3.4% in 2022. The improved prospects for global economic growth have led to an increase in current and expected oil prices. Production interruptions due to a heavy winter, reduced inventories, and increased supply restrictions instituted by producing countries have also contributed to the increase. Meanwhile, market forecasts and recent Federal Reserve pronouncements suggest that the benchmark interest rate in the U.S. will remain stable for the next two years. Nevertheless, a significant increase in public spending in the country has fostered expectations for greater growth and inflation, as well as increased uncertainty over the moment in which a normalization of monetary policy might begin. This has been reflected in an increase in long-term interest rates. In this context, emerging market economies in the region, including Colombia, have registered increases in sovereign risk premiums and long-term domestic interest rates, and a depreciation of local currencies against the dollar. Recent outbreaks of COVID-19 in several of these economies; limits on vaccine supply and the slow pace of immunization campaigns in some countries; a significant increase in public debt; and tensions between the United States and China, among other factors, all add to a high level of uncertainty surrounding interest rate spreads, external financing conditions, and the future performance of risk premiums. The impact that this environment could have on the exchange rate and on domestic financing conditions represent risks to the macroeconomic and monetary policy forecasts. Domestic financial conditions continue to favor recovery in economic activity. The transmission of reductions to the policy interest rate on credit rates has been significant. The banking portfolio continues to recover amid circumstances that have affected both the supply and demand for loans, and in which some credit risks have materialized. Preferential and ordinary commercial interest rates have fallen to a similar degree as the benchmark interest rate. As is generally the case, this transmission has come at a slower pace for consumer credit rates, and has been further delayed in the case of mortgage rates. Commercial credit levels stabilized above pre-pandemic levels in March, following an increase resulting from significant liquidity requirements for businesses in the second quarter of 2020. The consumer credit portfolio continued to recover and has now surpassed February 2020 levels, though overall growth in the portfolio remains low. At the same time, portfolio projections and default indicators have increased, and credit establishment earnings have come down. Despite this, credit disbursements continue to recover and solvency indicators remain well above regulatory minimums. 1.2 Monetary policy decision In its meetings in March and April the BDBR left the benchmark interest rate unchanged at 1.75%.

Macroeconomic Summary Overall inflation (1.61%) and core inflation (excluding food and regulated items) (1.11%) both declined beyond the technical staff’s expectations in the fourth quarter of 2020. Year-end 2021 forecasts for both indicators were revised downward to 2.3% and 2.1%, respectively. Market inflation expectations also fell over this period and suggested inflation below the 3% target through the end of this year, rising to the target in 2022. Downward pressure on inflation was more significant in the fourth quarter than previously projected, indicating weak demand. Annual deceleration among the main groups of the consumer price index (CPI) was generalized and, except for foods, was greater than projected in the October report. The CPI for goods (excluding foods and regulated items) and the CPI for regulated items were subject to the largest decelerations and forecasting discrepancies. In the first case, this was due in part to a greater-than-expected effect on prices from the government’s “VAT-fee day” amid weak demand, and from the extension of some price relief measures. For regulated items, the deceleration was caused in part by unanticipated declines in some utility prices. Annual change in the CPI for services continued to decline as a result of the performance of those services that were not subject to price relief measures, in particular. Although some of the overall decline in inflation is expected to be temporary and reverse course in the second quarter of 2021, various sources of downward pressure on inflation have become more acute and will likely remain into next year. These include ample excesses in capacity, as suggested by the continued and greater-than-expected deceleration in core inflation indicators and in the CPI for services excluding price relief measures. This dynamic is also suggested by the minimal transmission of accumulated depreciation of the peso on domestic prices. Although excess capacity should fall in 2021, the decline will likely be slower than projected in the October report amid additional restrictions on mobility due to a recent acceleration of growth in COVID-19 cases. An additional factor is that low inflation registered at the end of 2020 will likely be reflected in low price adjustments on certain indexed services with significant weight in the CPI, including real estate rentals and some utilities. These factors should keep inflation below the target and lower than estimates from the previous report on the forecast horizon. Inflation is expected to continue to decline to levels near 1% in March, later increasing to 2.3% at the end of 2021 and 2.7% at year-end 2022 (Graph 1.1). According to the Bank’s most recent survey, market analysts expect inflation of 2.7% and 3.1% in December 2021 and 2022, respectively. Expected inflation derived from government bonds was 2% for year-end 2021, while expected inflation based on bonds one year forward from that date (FBEI 1-1 2022) was 3.2%.