Happy taxation : increasing tax compliance through positive rewards?
Title: Happy taxation : increasing tax compliance through positive rewards?
Citation: Journal of public policy, 2016, Vol. 36, No. 3, pp. 381-406
ISSN: 0143-814X; 1469-7815
Can governments increase tax compliance by rewarding honest taxpayers? We conducted a controlled laboratory experiment comparing tax compliance under a “deterrence” baseline with tax compliance under two “reward” treatments: a “donation” treatment giving taxpayers a say in the spending purposes of their payments and a “lucky” treatment giving taxpayers the (highly unlikely) chance of winning a lottery. The reward treatments significantly affected tax behaviour but not in a straightforward manner. Although female participants altered their behaviour as expected and complied somewhat more, men strongly reacted in the opposite manner: they evaded a much higher percentage of taxes than under the baseline. Apparently, there is no one-size-fits-all approach to boost tax compliance.
Published online: 15 October 2015.
Type of Access: openAccess
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