Audit State Dependent Taxpayer Compliance: Theory and Evidence From Colombia

Abstract

We develop and analyze a dynamic model of individual taxpayer compliance choice that predicts “audit state dependent taxpayer compliance,” by distinguishing between forward‐looking versus myopic versus naïve behavior. We then test experimentally the audit state dependent model by reporting the results from the first tax compliance experiment run in Colombia. We find that subjects' compliance rates increase with greater enforcement. We also find more novel results: fine rates should be increased after an audit, and “nudging” myopic individuals toward reporting a constant rather than a fluctuating proportion of income would benefit both the taxpayer and the tax authority.(JEL H26, C91)

Comparison of Biobutanol Production Pathways via Acetone–Butanol–Ethanol Fermentation Using a Sustainability Exergy-Based Metric

“…However, it is worth mentioning that current policies are aimed at gradually reducing such rates to encourage business development and the creation of entrepreneurships. 49 Table 5 summarizes assumptions made for developing process economic evaluation of ABE topologies.…”

“…Regarding Latin American countries, Colombia remains like one of the countries with the highest tax rates of value-added and business. However, it is worth mentioning that current policies are aimed at gradually reducing such rates to encourage business development and the creation of entrepreneurships Table summarizes assumptions made for developing process economic evaluation of ABE topologies.…”