Cyclicality of Revenue and Structural Balances in South Africa [electronic resource] / Burcu Aydin.
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TextSeries: IMF Working Papers; Working Paper ; No. 10/216Publication details: Washington, D.C. : International Monetary Fund, 2010Description: 1 online resource (24 p.)ISBN: 1455208817 :ISSN: 1018-5941Subject(s): Budget Balance | Commodity and Asset Prices | Credit Growth | Econometric Modeling: General | Multiple or Simultaneous Equation Models: Time-Series Models | Structural Balance | South AfricaAdditional physical formats: Print Version:: Cyclicality of Revenue and Structural Balances in South AfricaOnline resources: IMF e-Library | IMF Book Store Abstract: This paper applies a disaggregated method for the calculation of the cyclical component of the budget balance for South Africa with an emphasis on the effect of commodity and asset prices, and credit cycle. Results show that the cyclicality of tax revenue is mostly explained by the variations in tax bases. Change in the credit to private sector also has some affect on the revenue performance; however, asset and commodity prices are not significant in explaining the deviation of revenue from its trend. Nonetheless, quantitative effects of these prices are subject to assumptions used for long-run price levels.
This paper applies a disaggregated method for the calculation of the cyclical component of the budget balance for South Africa with an emphasis on the effect of commodity and asset prices, and credit cycle. Results show that the cyclicality of tax revenue is mostly explained by the variations in tax bases. Change in the credit to private sector also has some affect on the revenue performance; however, asset and commodity prices are not significant in explaining the deviation of revenue from its trend. Nonetheless, quantitative effects of these prices are subject to assumptions used for long-run price levels.
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