Tax Administration versus Tax Rates: Evidence from Corporate Taxation in Indonesia

• 成果类型: Article
• 署名作者: Basri, M. Chatib; Felix, Mayara; Hanna, Rema; Olken, Benjamin A.
• 署名单位: University of Indonesia; Massachusetts Institute of Technology (MIT); Harvard University
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20201237
• 发表日期: 2021
• 页码: 3827-3871
• 关键词: taxable income; deadweight loss; elasticity

摘要

We compare two approaches to increasing tax revenue: tax administration and tax rates. We show that when Indonesia moved top regional firms into medium taxpayer offices, with high staff-to-taxpayer ratios, tax revenue more than doubled. Examining nonlinear changes to corporate income tax rates, we estimate an elasticity of taxable income of 0.579. Combining these estimates, improved tax administration is equivalent to raising top rates on all firms by 8 percentage points. On net, improved tax administration can have significant returns for developing countries.