The Role of Excise Tax in Economic Development

Abstract

This study aims to analyze the role of excise tax in economic development, focusing on its fiscal, regulatory, and social functions. The research investigates how excise taxation influences consumption patterns, public health outcomes, and government revenue in developing economies, particularly Uzbekistan. The study adopts a mixed-method approach combining econometric analysis, comparative analysis, and theoretical evaluation. Secondary data from national statistics and international reports were used. Regression analysis was applied to assess the relationship between excise tax revenue, consumption of excisable goods, and GDP growth. The findings indicate that excise taxes significantly contribute to government revenues and effectively reduce the consumption of harmful goods such as tobacco and alcohol. However, excessively high excise taxes may lead to illicit trade and tax evasion. This study integrates public finance theory with behavioral economics, providing a comprehensive framework for understanding excise taxation as both a fiscal and regulatory instrument.