IDEAS home Printed from https://ideas.repec.org/p/ivi/wpasad/1994-06.html
   My bibliography  Save this paper

Honesty versus progressiveness in income tax enforcement problems

Author

Listed:
  • Francisco Marhuenda Hurtado

    (Universidad Carlos III de Madrid)

  • Ignacio Ortuño Ortín

    (Universidad de Alicante)

Abstract

We study an income tax enforcement problem using a principal agent model where the government sets the tax and inspection functions. These functions are announced to the agents and there is no commitment problem. The penalty function for dishonest taxpayers is given exogenously and must satisfy certain social norms. We give a partial characterization of the optimal policy and prove that for a large family of penalty functions this policy is such that honesty implies regressiveness. It is also shown that the result does not depend on the fact that agents know the true probability of inspection.

Suggested Citation

  • Francisco Marhuenda Hurtado & Ignacio Ortuño Ortín, 1994. "Honesty versus progressiveness in income tax enforcement problems," Working Papers. Serie AD 1994-06, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    • Handle: RePEc:ivi:wpasad:1994-06
    as

    Download full text from publisher

    File URL: http://www.ivie.es/downloads/docs/wpasad/wpasad-1994-06.pdf
    File Function: Fisrt version / Primera version, 1994
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ivi:wpasad:1994-06. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Departamento de Edición (email available below). General contact details of provider: https://edirc.repec.org/data/ievages.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.