Eureka! Institutional Repository

Tax revenue, as a collective mean for state income, in order to sustain or increase government total revenue forms the main economic strength index of a an organized government. A stable and fair tax policy which returns equal or increased revenue to government’s funds with the equal share of merits to citizens and enterprises guided by citizen’s well-being shows a strong economy and a fare organized state. In this project we have examined the basic tool of taxation, the tax rate; and to be more precise the development of enterprise tax rate ant its effect on local investment as well as in entrepreneurship. Results have shown that the continues changes, even if they have a declining behavior, do not affect local investments but have a negative effect on investments by Greek entrepreneurs to other countries. Numeric results as well as theoretical approach have shown that the main problem is the taxation system itself by imposing taxes in an arbitrary manner depending on custom needs. By following the same thinking, enterprise tax rate acts as a revenue reserve by adjusting its figure depending on custom government’s needs, and, although it does not have an immediate effect on entrepreneurship, it leads to total negative impact by not allowing strategic planning and business forecasting for the following years.