Event Title

Tax Compliance and Spending: A Lab Experiment

Location

Hart 114

Start Time

12-5-2016 11:25 AM

End Time

12-5-2016 11:40 AM

Description

All tax systems result in tax evasion by some members of the economy. In order to increase compliance and thereby increase revenues to supply benefits the use of positive inducements with tax laws have been tried. The positive incentives must be coordinated with the tax filing/paying process to induce the desired behavior: filing and paying the taxes owed. The efficacy of these types of policies can be tested in the lab more efficiently and for lower costs than implementing policies and testing them after the fact. This research tests whether voting for various public goods are a positive inducement to filing taxes and paying the amount owed.

The results will provide valuable information for policy makers. If a link exists between the existence of a voting scheme built into the tax filing process it will show up as a statistically significant factor in a multiple linear regression model. Using software from previous research for the IRS, new treatments will be implemented to perform a multiple period experiment. A very large dataset will be recorded by the experiment software capturing and controlling for the dominant influences on the tax filer’s decision.

Comments

Moderator: Hadidja Nyiransekuye

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May 12th, 11:25 AM May 12th, 11:40 AM

Tax Compliance and Spending: A Lab Experiment

Hart 114

All tax systems result in tax evasion by some members of the economy. In order to increase compliance and thereby increase revenues to supply benefits the use of positive inducements with tax laws have been tried. The positive incentives must be coordinated with the tax filing/paying process to induce the desired behavior: filing and paying the taxes owed. The efficacy of these types of policies can be tested in the lab more efficiently and for lower costs than implementing policies and testing them after the fact. This research tests whether voting for various public goods are a positive inducement to filing taxes and paying the amount owed.

The results will provide valuable information for policy makers. If a link exists between the existence of a voting scheme built into the tax filing process it will show up as a statistically significant factor in a multiple linear regression model. Using software from previous research for the IRS, new treatments will be implemented to perform a multiple period experiment. A very large dataset will be recorded by the experiment software capturing and controlling for the dominant influences on the tax filer’s decision.