Arbeitspapier

Nudging Businesses to Pay Their Taxes: Does Timing Matter?

This paper provides theoretical and empirical evidence on the implications of the timing of reminders by studying the effect of varying the timing of reminder letters to taxpayers on their payment behavior. The collection of unpaid tax debts constitutes a considerable challenge for tax authorities. We show that varying the timing of a reminder letter has a theoretically ambiguous effect on tax payments. We study the payment behavior of business taxpayers in a field experiment in Australia and find that a simple reminder letter increases the probability of payment by about 25 percentage points relative to a control group that does not receive a letter from the tax authority. However, variation over a three-week period in the timing of the reminder letter has no effect on the probability of payment within seven weeks of the due date. Our findings indicate that sending reminders early results in faster payment of debts with no effect on the ultimate probability of payment.

Sprache
Englisch

Erschienen in
Series: IZA Discussion Papers ; No. 11599

Klassifikation
Wirtschaft
Field Experiments
Business Taxes and Subsidies including sales and value-added (VAT)
Tax Evasion and Avoidance
Thema
tax compliance
business taxation
natural field experiment
behavioral insights

Ereignis
Geistige Schöpfung
(wer)
Gillitzer, Christian
Sinning, Mathias
Ereignis
Veröffentlichung
(wer)
Institute of Labor Economics (IZA)
(wo)
Bonn
(wann)
2018

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Gillitzer, Christian
  • Sinning, Mathias
  • Institute of Labor Economics (IZA)

Entstanden

  • 2018

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