Technology, Taxation, and Corruption : Evidence from the Introduction of Electronic Tax Filing
Many e-government initiatives introduce technology to improve efficiency and avoid potential human bias. Electronic tax filing (e-filing) is an important example, as developing countries increasingly adopt online submission of tax declarations to r...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2018
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/906671526994655975/Technology-taxation-and-corruption-evidence-from-the-introduction-of-electronic-tax-filing http://hdl.handle.net/10986/29862 |
| Summary: | Many e-government initiatives introduce
technology to improve efficiency and avoid potential human
bias. Electronic tax filing (e-filing) is an important
example, as developing countries increasingly adopt online
submission of tax declarations to replace in-person
submission to tax officials. This paper examines the impact
of e-filing on compliance costs, tax payments, and bribe
payments using experimental variation and data from
Tajikistan firms. Firms that e-file have lower compliance
costs, spending five fewer hours each month on fulfilling
tax obligations. There are no significant average effects of
e-filing on tax or bribe payments, but significant
heterogeneity exists across firms by their baseline
likelihood of tax evasion. Among firms previously more
likely to evade, e-filing doubles tax payments, likely by
disrupting collusion with officials. Conversely, among firms
less likely to have been evading, e-filing reduces tax
payments, suggesting that officials had previously required
them to pay more. These firms also pay fewer bribes, as
e-filing reduces opportunity for extortion. In all, the
results indicate that e-filing reduces compliance costs and
makes the distribution of tax payments across firms arguably
more equitable. |
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