Abstract

https://ssrn.com/abstract=2911467
 


 



The Intergenerational Causal Effect of Tax Evasion: Evidence from the Commuter Tax Allowance in Austria


Wolfgang Frimmel


University of Linz

Martin Halla


University of Innsbruck - Department of Public Finance

Jörg Paetzold


University of Salzburg


IZA Discussion Paper No. 10529

Abstract:     
Does tax evasion run in the family? To answer this question, we study the case of the commuter tax allowance in Austria. This allowance is designed as a step function of the distance between the residence and the workplace, creating sharp discontinuities at each bracket threshold. The distance to these brackets is a strong determinant of compliance since it corresponds to the probability of detection. The match of different administrative data sources allows us to observe actual compliance behavior at the individual level across two generations. To identify the intergenerational causal effect in tax evasion behavior, we use the paternal distance-to-bracket as an instrumental variable for paternal compliance. We find that paternal noncompliance increases children's non-compliance by about 20 percent.

Keywords: tax evasion, tax morale, intergenerational correlation, intergenerational causal effect

JEL Classification: H26, A13, H24, J62, D14


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Date posted: February 5, 2017  

Suggested Citation

Frimmel, Wolfgang and Halla, Martin and Paetzold, Jörg, The Intergenerational Causal Effect of Tax Evasion: Evidence from the Commuter Tax Allowance in Austria. IZA Discussion Paper No. 10529. Available at SSRN: https://ssrn.com/abstract=2911467

Contact Information

Wolfgang Frimmel (Contact Author)
University of Linz ( email )
Altenbergerstr. 69
A-4040 Linz, Uper Austria 4040
Austria
Martin Halla
University of Innsbruck - Department of Public Finance ( email )
Innrain 52
Innsbruck, 6020
Austria
Jörg Paetzold
University of Salzburg ( email )
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