Don't Blame the Messenger: A Field Experiment on Delivery Methods for Increasing Tax Compliance

76 Pages Posted: 9 Feb 2016

See all articles by Daniel Ortega

Daniel Ortega

Instituto de Estudios Superiores de Administración (IESA)

Carlos Scartascini

Research Department - Inter-American Development Bank (IDB)

Date Written: October 2015

Abstract

There is an ample literature on the determinants of tax compliance. Several field experiments have evaluated the effect and comparative relevance of sending deterrence and moral suasion messages to taxpayers. The effect of different delivery mechanisms, however, has not been evaluated so far. This study conducts a field experiment in Colombia that varies the way the National Tax Agency contacts taxpayers on payments due for income, value added, and wealth taxes. More than 20,000 taxpayers were randomly assigned to a control or one of three delivery mechanisms (letter, email, and personal visit by a tax inspector). Results indicate large and highly significant effects, as well as sizable differences across delivery methods. A personal visit by a tax inspector is more effective than a physical letter or an email, conditional on delivery, but email tends to reach its target more often. Improving the quality of taxpayer contact information can significantly improve the collection of delinquencies.

Keywords: Tax compliance, Field experiments, Delivery methods, Optimal

JEL Classification: C93, D03, H26

Suggested Citation

Ortega, Daniel and Scartascini, Carlos G., Don't Blame the Messenger: A Field Experiment on Delivery Methods for Increasing Tax Compliance (October 2015). IDB Working Paper No. IDB-WP-627, Available at SSRN: https://ssrn.com/abstract=2729732 or http://dx.doi.org/10.2139/ssrn.2729732

Daniel Ortega (Contact Author)

Instituto de Estudios Superiores de Administración (IESA) ( email )

C/ Campo Santo de los Mártires, 7
San Bernardo 1010, Caracas, Córdoba 14004
Venezuela

Carlos G. Scartascini

Research Department - Inter-American Development Bank (IDB) ( email )

1300 New York Avenue NW
Washington, DC 20577
United States
2026231963 (Phone)

HOME PAGE: http://www.cscartascini.org

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
182
Abstract Views
1,074
rank
207,932
PlumX Metrics