Do Tax Amnesties Work? The Revenue Effects of Tax Amnesties during the Transition in the Russian Federation
AbstractGovernments of all kinds have frequently and increasingly turned to tax amnesties as part of their fiscal programs. An amnesty typically allows individuals or firms to pay delinquent taxes without being subject to some or all of the financial and criminal penalties that the discovery of tax evasion normally brings. Tax amnesties are a controversial revenue-raising tool. Advocates emphasize the immediate and short-run revenue impact, and often argue that future tax revenues may increase if the amnesty induces individuals or corporations not on the tax rolls to participate, and if the amnesty is accompanied by more extensive taxpayer services, better education on taxpayer responsibilities, and, especially, stricter post-amnesty penalties for evaders and greater expenditures for enforcement. Critics contend that the actual experiences of many countries indicate that the immediate impact on revenues is almost always quite small. They also question the long-run revenue impact of a tax amnesty, especially if honest taxpayers resent the special treatment of tax evaders and if individuals come to believe that the amnesty is not simply a one-time opportunity. This paper discusses the multiple tax amnesties enacted in the Russian Federation during its main transition period of the 1990s and, especially, analyzes the impact of these amnesties on tax collections. We find that these amnesties had little short- or long-term impact on revenues. We conclude that the Russian amnesties, like most other amnesties, seem unlikely to have had significant positive – or negative – impacts on the revenues of the Russian Federation , a conclusion that calls into question their usefulness as a policy instrument.
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Bibliographic InfoPaper provided by International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University in its series International Center for Public Policy Working Paper Series, at AYSPS, GSU with number paper0718.
Length: 35 pages
Date of creation: 01 Aug 2007
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Do Tax Amnesties; the Russian Federation; Russia; tax evasion;
Other versions of this item:
- James Alm & Jorge Martinez-Vazquez & Sally Wallace, 2009. "Do Tax Amnesties Work? The Revenue Effects Of Tax Amnesties During The Transition In The Russian Federation," Economic Analysis and Policy (EAP), Queensland University of Technology (QUT), School of Economics and Finance, vol. 39(2), pages 235-253, September.
- H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion
- H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
- H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
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