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Audit publicity and tax compliance: a quasi-natural experiment

Author

Listed:
  • Pietro Battiston
  • Denvil Duncan
  • Simona Gamba
  • Alessandro Santoro

Abstract

We use confidential data on Value Added Tax payments at the sector level, in two large Italian cities, to estimate the effect of audits publicity on tax compliance of local sellers. By employing a Difference-in-Differences identification strategy, we find that such publicity has a positive effect on fiscal declarations made shortly after. The results suggest that increasing awareness on future audits via the media can be an important instrument in the hands of tax authorities.

Suggested Citation

  • Pietro Battiston & Denvil Duncan & Simona Gamba & Alessandro Santoro, 2016. "Audit publicity and tax compliance: a quasi-natural experiment," LEM Papers Series 2016/40, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  • Handle: RePEc:ssa:lemwps:2016/40
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    References listed on IDEAS

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    Cited by:

    1. Marcel Garz & Verena Pagels, 2017. "Cautionary Tales: Celebrities, the News Media, and Participation in Tax Amnesties," CESifo Working Paper Series 6795, CESifo Group Munich.
    2. Luigi Mittone & Fabrizio Panebianco & Alessandro Santoro, 2016. "The Bomb-Crater Effect of Tax Audits: Beyond Misperception of Chance," Working Papers 583, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.

    More about this item

    Keywords

    Tax evasion; Quasi-natural experiment; Audit publicity;

    JEL classification:

    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • K34 - Law and Economics - - Other Substantive Areas of Law - - - Tax Law
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy

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