Working Paper: CEPR ID: DP14463
Authors: Mazhar Waseem; Joel Slemrod; Obeid Ur Rehman
Abstract: We examine two Pakistani programs to see if the public disclosure of tax information and social recognition of top taxpayers promote tax compliance. Pakistan began revealing income tax paid by every taxpayer in the country from 2012. Simultaneously, another program beganrecognizing and rewarding the top 100 tax paying corporations, partnerships, self-employed individuals, and wage-earners. We find that both programs induced strong compliance responses. The public disclosure caused on average a 9 log-points increase in the tax paid byindividuals exposed to the program. The increase was even larger for the social recognition program, around 17 log-points. Our results suggest that such programs can be important policy levers to mobilize resources, especially in weak-enforcement-capacity economies.
Keywords: tax evasion; income tax; social norms
JEL Codes: H24
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Public Disclosure Program (G28) | Perceived and Actual Likelihood of Detection (C91) |
| TPHC Program (I19) | Reported Income (D31) |
| Public Disclosure Program (G28) | Tax Payments (H29) |
| Public Disclosure Program (G28) | Tax Payments (for unique names) (H29) |
| Public Disclosure Program (G28) | Tax Payments (for common names) (H29) |
| TPHC Program (I19) | Tax Payments (H29) |