This paper examines the process by which firms are selected for a sales tax audit and the determinants of subsequent firm compliance behavior, focusing upon the Gross Receipts Tax in New Mexico. A two-stage selection model is used to estimate the State's audit selection rule and, conditional...

This paper examines the process by which firms are selected for a sales tax audit and the determinants of subsequent firm compliance behavior, focusing upon the Gross Receipts Tax in New Mexico. A two-stage selection model is used to estimate the State's audit selection rule and, conditional...

This note reports on the results from a small scale investigation of the compliance effects of a costly pre-audit on tax compliance. The tax compliance game is modeled in three parts: a declaration phase, a pre-selection phase with a cost for taxpayers, and an audit selection phase where all...