State purchases of bank data on suspected tax evaders from international tax havens constitute a potential tool to combat international tax evasion. Using self-compiled data for North-Rhine Westphalia on the timing and content of such data acquisitions from whistleblowers and on monthly...

This paper explores the role of fiscal equalization as a driver of states’ tax policy in Germany. We argue that fiscal redistribution of tax revenues provides an incentive for states to increase their tax rates. The analysis exploits differences in the degree of fiscal redistribution among the...

Does tax evasion run in the family? We study the case of the commuter tax allowance in Austria, which is designed as a step function of the commuting distance, creating sharp discontinuities at each bracket threshold. The data sources allow us to observe actual compliance behavior at the...

This paper considers the welfare implications of a tax on real estate transfers. A theoretical analysis shows how the discouragement of mutually beneficial transactions as well as tax- sheltering activities give rise to a welfare loss that can be estimated using the empirical elasticity of the...

If taxpayers believe past rates of compliance are indicative of the future, traditional measures for combating tax evasion can be compromised. We present evidence from a novel laboratory experiment with strategic complementarities showing that a history of low compliance can render a major...

Many countries grant exemption from legal prosecution under certain conditions, allowing for voluntary disclosures regarding tax evasion. Empirically, tax amnesties appear most successful when accompanied by an increase in enforcement efforts because they help evaders to adjust to the new...

Is tax compliance driven only by extrinsic motivations such as deterrence and tax policy or is there also a role for intrinsic motivations such as morals, norms and psychology? Agents may comply based on moral sentiments, social norms, guilt and shame (Andreoni et al. 1998), all of which are...

This paper derives the optimal financial contract when a borrowing entrepreneur can evade taxes in a model of costly state verification. In contrast to previous literature on costly state verification and financial contracting, we find that standard debt contracts are not optimal when tax...