Towards evidence-based tax administration

Abstract

An evidence-based approach is being promoted and adopted in many public service areas, but tax authorities have so far only sporadically subscribed to it. We, first, present arguments for an evidence-based approach to tax administration and outline its main features. Second, studies on the effects of tax-reporting schedules are considered to illustrate the logic, potential challenges and outcomes of such an approach. Third, we discuss the main principles of an evidence-based approach, as well as its practical and political obstacles in the context of taxation. An evidencebased approach means basing administrative practices and strategies on an understanding of relevant processes that is obtained from systematic, theory-driven and cumulative research, using various appropriate methodologies including experimental and quasi-experimental evaluation designs. However, an evidence-based approach needs to consider the challenges posed by short-term orientation and riskaverse defensive postures that result from political agendas, public media scrutiny and intraorganisational dynamics.