Title: Tax capacity assessment and performance: a within state analysis

Authors: Vishnu Vivek M; Punniyamoorthy Murugesan; V. Avanya

Addresses: Department of Management Studies, National Institute of Technology, Tiruchirappalli, Tamil Nadu, India ' Department of Management Studies, National Institute of Technology, Tiruchirappalli, Tamil Nadu, India ' Department of Management Studies, National Institute of Technology, Tiruchirappalli, Tamil Nadu, India

Abstract: Stochastic frontier analysis (SFA) is a statistical approach that is used extensively across domains. In this era of the COVID-19 pandemic, there is pressure on government finances as public healthcare expenditure has ballooned. As healthcare is the responsibility of provisional governments or states in many countries, it is imperative to analyse the tax capacity at the local level. The paper analyses the performance of various districts in the Southern Indian State of Kerala, India in the arena of tax capacity leveraging SFA. The study reveals the districts which are performing well as well as the laggards and highlights the tax capacity and inefficiency variables that the district administrations should focus on. The proposed model can be replicated across states in India and regional/provinces across economies worldwide thereby helping provincial administrations to prepare well to face epidemic outbreaks in the future as well.

Keywords: stochastic frontier analysis; SFA; tax capacity; tax effort; principal component analysis; PCA; gross state domestic product; GSDP.

DOI: 10.1504/IJBIS.2026.152781

International Journal of Business Information Systems, 2026 Vol.51 No.4, pp.437 - 452

Received: 19 May 2022
Accepted: 01 Jul 2022
Published online: 13 Apr 2026 *

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