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Graded Discussion Board No. 2
Advanced Research Methods (STAT730)
Due date: July 25th, 2019
Topic: “Selection of Appropriate Statistical Tests”
Objective of the activity
To familiarize the students with the selection of appropriate statistical tests.
After attempting this GDB, students will be able to select the appropriate statistical tests.
Recent wave of tax reforms in Pakistan led majority of people in unrest. The anticipated sales tax gap is ~67% of the total sales tax collection of Rs. 1,715 billion. As per Global Competitiveness Index (GCI, 2018), tax regulations and tax rates are among the most problematic factors of doing business in Pakistan. It is very unfortunate that Pakistan has only 40,000 (approximately) registered sales tax payers.
Considerable losses in tax revenue occurs due to the fraud in sales tax. Even the registered businesses acquire fake purchase invoice (to boost deductible input tax) and sales tax related identity frauds, which is still the daunting challenge to tackle the issue. Weak government writ, fragile institutions, less regulatory quality, ineffective accountability processes, poor rule of law, political instability, and pervasive corruption in Pakistan could be the prime contributors to sales tax gap. However, a workforce having higher level of education, literacy and technology are indispensable for effective implementation of sales tax policies and preventing tax fraud and evasion.
Automation in Federal Board of Revenue (FBR) is hence the need of hour to strengthen the system of accountability and transparency, henceforth tax net expansion and minimization of tax evasion. FBR and four provinces therefore, have agreed to announce online portal facility (to file sales taxes) in August 2019, as a part of government’s ease of doing business initiative. This tax reform will ultimately benefit the taxpayers to submit their returns through a single portal. Consequently, this and other tax reforms will multiply the sales tax revenue.
The research objective:
The prime objective of the above research was to investigate the impact of tax reforms on sales tax revenue.
It is very common for researchers to get quality data but report the findings which are incorrect because of incorrect selection of statistical tool for data analysis. After carefully analyzing the above premise and research objective, you are required to identify the appropriate statistical test and provide at least two justifications to support your choice.
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