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on Public Finance |
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Issue of 2024‒07‒29
three papers chosen by |
| By: | Brad C. Nathan; Ricardo Perez-Truglia; Alejandro Zentner |
| Abstract: | We provide evidence on the role of fairness for tax compliance: households are willing to pay more in taxes if they believe that other households are contributing their fair share. We conducted an information-disclosure natural field experiment in the context of property taxes in the United States. We induced exogenous shocks to households' perceptions about the average tax rate paid by other households. We find that a higher perceived average tax rate decreases the probability of filing a tax appeal. Translating our estimates into a money metric, we find that for each additional $1 contributed by the average household, a taxpayer is willing to pay an extra $0.43 in his or her own taxes. |
| JEL: | C93 H4 H70 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32588 |
| By: | Christopher Axelson; Antonia Hohmann; Jukka Pirttilä; Roxanne Raabe; Nadine Riedel |
| Abstract: | Rising levels of income inequality and tight government budgets have spurred discussions in many developing nations about how to appropriately tax high-income earners. In this paper, we study taxpayer responses to an increase in the top marginal tax rate in South Africa, drawing on exceptionally rich tax administrative data and a transparent empirical identification design. We establish that treated taxpayers strongly reduce their reported taxable income in response to the tax reform. Taxpayers' responses are driven by both reductions in broad income and increases in tax deductions. |
| Keywords: | Income inequality, Taxable income, South Africa, Tax reform, Top incomes |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:unu:wpaper:wp-2024-37 |
| By: | Bosco, Bruno; Bosco, Carlo Federico; Maranzano, Paolo |
| Abstract: | This paper uses the Italian income tax treatment of 2006/7 as a quasi-natural tax experiment to offer some fresh empirical evidence on how labour supply responds to exogenous income tax hikes. We adopt the identification strategy based on TWFE panel data Difference-in-Differences (DID) model to define the correct statistical framework of the study, and to benefit from the specific features of the above tax experiment, namely homogeneity and contemporaneity of the treatment. Results show that the extensive negative adjustments of various response variables measuring the supply of labour services offered by treated taxpayers are statistically significant, rapid, and strong but not long-time lasting. Not surprisingly, we also find that that treated families reduce in a similar manner their consumption with respect to families in the control groups. Analogous adjustment responses to tax hikes characterise the growth of per-capita regional GDP. The estimated aggregate effects of tax hikes are further compared with the spatial-temporal patterns observed for every response variable in treated and untreated regions. |
| Keywords: | Public Economics |
| Date: | 2024–06–27 |
| URL: | https://d.repec.org/n?u=RePEc:ags:feemwp:343514 |