Improving Tax Compliance without Increasing Revenue: Evidence from Population-Wide Randomized Controlled Trials in Papua New Guinea
Date
2023
Authors
Hoy, Christopher
mckenzie, Luke
Sinning, Mathias
Journal Title
Journal ISSN
Volume Title
Publisher
University of Chicago Press
Abstract
We study the effect of "nudges" on taxpayers who have varying tax-compliance histories in Papua New Guinea. We present the results from two population-wide randomized controlled trials conducted in a setting that is characterized by low compliance rates and a lack of effective enforcement. We test the effect of text messages, flyers, and emails that remind taxpayers of declaration due dates and provide information about the public benefits of paying taxes. We find that the treatments increased the number of tax declarations filed without increasing the amount of tax paid because the taxpayers who responded to the nudges reported a tax liability of zero. This result is consistent across tax types, communication channels, and time periods. We also find that the treatments had no effect on previously nonfiling taxpayers. Collectively, our results illustrate that taxpayers who face the lowest cost of compliance are the most likely to respond to a nudge.
Description
Keywords
Citation
Collections
Source
Economic Development and Cultural Change
Type
Journal article
Book Title
Entity type
Access Statement
Open Access
License Rights
CC BY-NC 4.0
DOI
Restricted until
Downloads
File
Description