Does going cashless make you tax-rich? Evidence from India's demonetization experiment

• 成果类型: Article
• 署名作者: Das, Satadru; Gadenne, Lucie; Nandi, Tushar; Warwick, Ross
• 署名单位: Reserve Bank of India; University of London; London School Economics & Political Science; Queen Mary University London; Centre for Economic Policy Research - UK; Indian Institute of Science Education & Research (IISER) - Kolkata; University of London; London School Economics & Political Science
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2023.104907
• 发表日期: 2023
• 关键词: tax compliance; Electronic payments; Demonetization

摘要

This paper investigates the tax compliance effects of India's demonetization policy, which limited cash availability for a short period of time. Using administrative data on firms' tax returns and variation in the strength of the demonetization shock across local areas, we find that demonetization increased sales reported to the tax authorities and tax payments. Investigating mechanisms, we show that demonetization led to a large increase in the use of electronic forms of payments. We argue that this likely strengthened tax authorities' capacity to observe tax liabilities and enforce compliance.& COPY;( ) 2023 Published by Elsevier B.V.