Targeting in Tax Compliance Interventions : Experimental Evidence from Honduras
Tax authorities often use low-cost communication with taxpayers to encourage voluntary compliance and avoid other costly interventions. This paper reports findings from an experiment with more than 30,000 taxpayers in Honduras, designed to assess h...
| Main Authors: | , , |
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| Language: | English |
| Published: |
Washington, DC: World Bank
2022
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/653411647279081382/Targeting-in-Tax-Compliance-Interventions-Experimental-Evidence-from-Honduras http://hdl.handle.net/10986/37155 |
| Summary: | Tax authorities often use low-cost
communication with taxpayers to encourage voluntary
compliance and avoid other costly interventions. This paper
reports findings from an experiment with more than 30,000
taxpayers in Honduras, designed to assess how taxpayers with
different risk scores respond to a communication
intervention. Across several outcomes, the average effect of
the intervention on compliance was 0. Contrary to the
expectation of experts surveyed, only taxpayers considered
to be at low risk of noncompliance increase their filing and
reported income. Using rich administrative data and a causal
forest algorithm, the paper finds that ex-ante predicted
risk and responsiveness to the intervention are negatively
correlated. These findings can inform the design of targeted
interventions by tax authorities. |
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