Optional (non-)filing and effective taxation

• 成果类型: Article
• 署名作者: Hauck, Tobias; Wallossek, Luisa
• 署名单位: University of Munich; University of Munich
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2024.105187
• 发表日期: 2024
• 关键词: Tax filing; Optional filing; Effective taxation; redistribution; tax progressivity

摘要

Many countries have automatic wage tax withholding systems with tax non-filing options for some taxpayers. We show that this has sizable and potentially unintended implications for effective taxation because taxes are often over-withheld. Low-income taxpayers pay more taxes than they have to because they frequently do not file. Using German administrative tax data, we document that the average non-filer overpays e 119 in one year, equivalent to a 1.2 percentage point increase in the average tax rate. Non-filing acts as a form of reverse evasion: It weakens the effective tax progressivity by increasing tax rates at the bottom of the income distribution.