Research Insights: Do Tax Amnesties Really Work?
Peer Reviewed
Date issued
Jul 2020
Publication
Subject
Tax Compliance;
Taxpayer;
Tax Amnesty;
Behavioral Economics;
Property Tax;
Tax Collection;
Tax Increase
JEL code
C93 - Field Experiments;
H23 - Externalities • Redistributive Effects • Environmental Taxes and Subsidies;
H42 - Publicly Provided Private Goods;
D62 - Externalities
Country
Argentina
Category
Catalogs and Brochures
A behaviorally informed notice can increase the effectiveness of tax amnesties. In Santa Fe, Argentina, notices of a tax amnesty were redesigned and tested against old and more complicated notices. A simpler notice decreased the cognitive cost of understanding it, which in turn increased the probability of joining the tax amnesty and the amount collected by the city. The downside of joining a tax amnesty is that people procrastinate on their own compliance and may set a bad example for their neighbors.
