Research Insights: Can Salient Penalties and Enforcement on Tax Bills Increase Compliance Across Taxes?
An analytical model and a field experiment in Argentina proved that salient enforcement messages on one type of tax could increase compliance with another tax. Salient messages of penalties and enforcement for the property tax had positive spillover effects on declaration of the gross sales tax, with taxpayers in the treatment group increasing their reported tax by 2 percent. Taxpayers appear to assume that higher enforcement of one tax implies higher enforcement for others, thereby increasing their compliance across taxes.
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| Language: | English |
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Inter-American Development Bank
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| Subjects: | Taxation, Tax Compliance, Economy, Public Health, Municipal Government, Port and Waterway, Tax Evasion, Property Tax, Debtor Finance, Tax Increase, Behavioral Economics, H26 - Tax Evasion and Avoidance, C93 - Field Experiments, D03 - Behavioral Microeconomics: Underlying Principles, H41 - Public Goods, Sales Tax;Randomized Field Experiment, |
| Online Access: | http://dx.doi.org/10.18235/0003799 https://publications.iadb.org/en/research-insights-can-salient-penalties-and-enforcement-tax-bills-increase-compliance-across-taxes |
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