Privatization during the transition period is carried out in accordance with the political concept adopted by the government of the country. The formation of this concept, the development of models, mechanisms, specific forms of privatization, decision-making on the retention of a number of economic objects in state ownership and on the sectors and limits of foreign capital’s access to privatization is an extremely important and complex process, since it affects the interests of the population and the economy of the country as a whole.
Privatization, which takes place in the absence of a market, plays an important role in the formation of a competitive market. In approaches to the definition of privatization from an economic point of view, there is also no unity in countries such as Italy or the United States. In the case of the state of Alabama, it is evident that privatization efforts are not being implemented due to the local market being mostly corporate.
However, the main recommendation is to build collaborative measures with a certain non-profit organization which can bring more efficient budget distribution. American experts understand privatization as a strategy and methods aimed at transferring a production system or production system or a system of providing public needs from government bodies to the private sector (Xu, Tihanyi, & Hitt, 2017). In the narrow sense, the term privatization means the full or partial transfer to a business company, partnership, or individual citizen of the right to own property of a particular state-owned enterprise. Their common criterion is to reduce the share and limit the functions of the public sector.
Also used is the concept of industrial privatization, which takes various forms in European countries. The primary example is the city of Rome, where major privatization efforts are manifested in the process of outsourcing certain governmental activities. In addition, Rome can induce privatization by stimulating local businesses by adjusting strict regulations that withhold the majority of entrepreneurs (Xu et al., 2017). Moreover, each country finds its own specific solution to problems related to the public sector. The variety of privatization methods used increases its efficiency and brings certain dividends to the state. The main reasons are that costs are reduced, and the privatization process itself is facilitated.
The city of Rome’s policy trend analysis demonstrates that alternative taxes are being enforced on mostly key corporate individuals and business owners, who are the most likely avoid paying regular taxes. When applying special taxation regimes, taxpayers do not pay taxes that are inherent in the general taxation regime. In other words, organizations do not pay corporate income tax, and corporate property tax, and individual entrepreneurs do not pay personal income tax and personal property tax (Hayes & Dennis, 2014). Organizations and individual entrepreneurs applying special tax regimes are not payers. Instead of the above taxes, organizations and individual entrepreneurs pay one single tax or pay the cost of a patent, depending on the special tax regime applied.
The policy trend analysis of the state of Alabama indicates that the given municipal unit does not show a strong focus on the alternative taxation system. In the case of the introduction of a regional tax in the territory of a subject of the United States, its elements are regulated by both the tax code and local law. In this case, the tax code regulates most of the aspects of tax, and at the regional level, only the tax rate, as well as the procedure and timing of tax payment, and within limits set at the federal level. Local law may also provide for tax credits that apply to a US entity.
The current non-partnership policy of the city of Rome potentially might affect the revenue rate by allowing the local government to organize profit-driven events. Local taxes are taxes that are valid in the territory of the municipality in which they are introduced. Therefore, for the application of domestic tax in the relevant region, it is necessary to have a regulatory legal act of the local government on tax (Hayes & Dennis, 2014). At the municipal level, when introducing a local tax, such elements of taxation as the tax rate, as well as the procedure and deadlines for tax payment, are mandatory to be regulated within limits set at the federal level. Optionally, at the municipal level, tax benefits may be provided, the grounds and procedure for their application.
The state of Alabama’s budget redistribution policies has a strong likelihood to become revenue affecting regulation. All other elements of local taxes are regulated at the federal level, i.e., the tax code, as applied to land tax, or the Federal law, as applied to property tax for individuals.
At the regional level, in particular, the amount of potential annual income by types of entrepreneurial activity, within limits set at the federal level, is set (Hayes & Dennis, 2014). In addition, the regional law may further separate the types of activities established in US law if it is provided for by the general classifier of public services and types of economic activity. An additional list of household services may be established according to the general classifier of public services.
In conclusion, the patent system of taxation, in essence, is more similar to regional taxes than to federal ones. In order to use the single tax on imputed income, it is necessary to adopt in the territory of the municipality a regulatory legal act of the local government on this taxation regime. Only in the presence of this regulatory legal act, taxpayers can apply this system within the municipality. Elements of taxation of this system are regulated both by the tax code and the regulatory legal act of the local government.
References
Hayes, T. J., & Dennis, C. (2014). State adoption of tax policy: New data and new insights. American Politics Research, 42(6), 929-955.
Xu, K., Tihanyi, L., & Hitt, M. A. (2017). Firm resources, governmental power, and privatization. Journal of Management, 43(4), 998-1024.