Value added tax (VAT) is one of the main types of taxes, generating the highest revenue for governments and thus contributing significantly to national budgets. Therefore, examining the nature of VAT and identifying the factors that increase its revenue is essential and can be beneficial for policymakers. This means that they can optimize VAT revenue collection by adjusting economic and fiscal policies that directly impact the factors determining VAT revenue. Consequently, increasing VAT revenue can be achieved not only by directly adjusting VAT policy, but also by modifying other variables that have a direct impact on VAT. Given that one of the factors influencing VAT revenue is the geographical proximity of regions, this study aims to examine the most important factors affecting VAT revenue, taking into account geographical distance. To estimate the spatial effects of geographical distance, an adjacency matrix was used. This research utilizes annual data for the period 2008-2021 for selected countries in the Middle East. The findings indicate a positive effect of geographical distance among the studied countries; therefore, the distance dimension is significant within the study group. Furthermore, the results show that per capita income, household consumption, and imports have a positive and significant effect on VAT revenue, while inflation has a negative and significant effect. Therefore, it is suggested that countries with close geographical proximity can seek to increase and improve their VAT revenue by strengthening their trade relations.. Therefore, it is suggested that countries with close geographical proximity can seek to increase and improve their VAT revenue by strengthening their trade relations.
NajafiZadeh, S. F., & Alizadeh, M. (2026). Examining the factors influencing value-added tax revenues: Spatial econometrics approach. Public Sector Economics Studies, 5(1), -. doi: 10.22126/pse.2026.12888.1217
MLA
Seyedeh Fatemeh NajafiZadeh; Mohammad Alizadeh. "Examining the factors influencing value-added tax revenues: Spatial econometrics approach". Public Sector Economics Studies, 5, 1, 2026, -. doi: 10.22126/pse.2026.12888.1217
HARVARD
NajafiZadeh, S. F., Alizadeh, M. (2026). 'Examining the factors influencing value-added tax revenues: Spatial econometrics approach', Public Sector Economics Studies, 5(1), pp. -. doi: 10.22126/pse.2026.12888.1217
VANCOUVER
NajafiZadeh, S. F., Alizadeh, M. Examining the factors influencing value-added tax revenues: Spatial econometrics approach. Public Sector Economics Studies, 2026; 5(1): -. doi: 10.22126/pse.2026.12888.1217
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