Stability of Tax Burden

Abstract

A stabilised tax system is a necessary element of an efficient legal system. Assurance of stability of the
tax system is crucial for tax payers, who can plan their undertakings over a longer period of time, without
being exposed to the danger of tax rate changes. The most visible symptom of tax law stability is the stability
of tax rates. The guarantee of fixed tax rates is one of the most important incentives for investors, who take
it under consideration when estimating the risk connected with starting a new enterprise in a given market.
Establishment of a stabilised tax system turns out to be very difficult in practice. There are several
factors, amongst which the most important are: political background; sovereignty of lawmakers, who can
almost unlimitedly define the level of tax burden; changes taking place in former socialist countries in the
late 1980’s and early 1990’s causing radical tax system reforms; and, at last, the process of accession to the
European Community, which required harmonisation of state law systems with the European one.
The above makes one ask the question whether it is possible to create a stabilised tax system with all
those factors around and eventually how to outline the area of stability