Tax Compliance and Enforcement

2019/12/01 by Joel Slemrod · 10 citations
Economics, Econometrics and Finance · Business, Management and Accounting · #Taxation and Compliance Studies #Corporate Taxation and Avoidance #Fiscal Policy and Economic Growth

paper · doi:10.1257/jel.20181437

Abstract

This paper reviews recent economic research in tax compliance and enforcement. After briefly laying out the economics of tax evasion, it focuses on recent empirical contributions. It first discusses what methodologies and data have facilitated these contributions, and then presents critical summaries of what has been learned. It discusses a promising new development—the analysis of randomized controlled trials mostly delivered via letters from the tax authority—and then reviews recent research using various methods about the impact of the principal enforcement tax policy instruments: audits, information reporting, and remittance regimes. I also explore several understudied issues worthy of more research attention. The paper closes by outlining a normative framework based on the behavioral response elasticities now being credibly estimated that allow one to assess whether a given enforcement intervention is worth doing. (JEL H26, H30)

Citations

• The Nature of the Firm
• The Elasticity of Taxable Income with Respect to Marginal Tax Rates: A Critical Review
• Salience and Taxation: Theory and Evidence
• Prospect Theory: An Analysis of Decision under Risk

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• Using Divide-and-Conquer to Improve Tax Collection
• How long does the impact of corruption persist? Evidence from self-reported tax morale by multigenerational immigrants
• The Taxing Challenges of the State: Unveiling the Role of Fiscal and Administrative Capacity in Development
• Firm Responses to Tax Audits: Regression Discontinuity Evidence from a Threshold-Based Audit Program
• Behavioural nudges as text messages to reduce non-payment for services: a field experiment

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