What happens when the tax authority increases enforcement in one tax with compliance in other taxes? The very little evidence available is not conclusive. This paper presents a very simple analytical model that shows the conditions under which spillovers could be positive or negative in the...

Tax evasion is a pervasive problem in many countries. In particular, some developing countries do not collect even half of what they would if taxpayers complied with the written letter of the law. The academic literature has not been oblivious to the need to explain why people pay (or do not...

Tax evasion is a pervasive problem in many countries. In particular, some developing countries do not collect even half of what they would if taxpayers complied with the written letter of the law. The academic literature has not been oblivious to the need to explain why people pay (or do not...

We use firm-level administrative data from Ecuador to study the implications of ‘reverse withholding’ for firms’ tax behavior. Withholding does not affect tax liability of firms, but it may result in a discontinuity in the audit probability around the withholding threshold. Exploiting...

The cash economy and associated tax evasion is an on-going issue for most tax administrators. Tax evasion reduces national tax revenue, shifts the tax burden on to other taxpayers such as salary/wage earners and undermines confidence in the tax system affecting voluntary compliance as well as...

In this paper I study whether citizens' tax morale (and, more broadly, citizens' attitudes towards the state) can be affected by past institutions, focusing on the role of historical fiscal capacity. Exploiting the features of the tax collection system of a pre-unification state in XIX Century...

In a simple cash-credit model, I study the effects of the combination of costly tax collection and tax evasion on fiscal and monetary policy for optimal resource allocation. Allowing the informal sector to use cash more intensively than the formal sector, I compute the optimal interest and tax...

Using panel data on the full population of corporate tax returns of Armenian firms, we study the behavioral response of firms to three size-dependent regulations. We find: i) a strong response to an accounting notch where International Financial Reporting Standards become mandatory; ii) a...

In this paper, I investigate to what extent the cross-country variation in nominal interest rates can be explained as being due to governments' optimal response to economic conditions such as tax collection costs, tax evasion and government consumption needs. In particular, I study the effects...