Strategic or Confused Firms? Evidence from "Missing" Transactions in Uganda

Miguel Almunia, Jonas Hjort, Justine Knebelmann and Lin Tian

No 29059, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Are firms sophisticated maximizers, or do they consistently make errors? Using transaction-level data from Ugandan value-added tax (VAT) returns, we show that sellers and buyers report different amounts 79% of the time, despite invoices being easily cross-checked. We estimate that 25% of firms are disadvantageous misreporters—they systematically misreport own sales and purchases such that their tax liability increases—while 75% are advantageous misreporters. Many firms—especially disadvantageous misreporters—fail to report imported inputs they themselves reported at Customs, increasing their VAT liability. On net, unilateral VAT misreporting cost Uganda about US$384 million in foregone 2013-2016 tax revenue

JEL-codes: D2 D9 H2 O1 (search for similar items in EconPapers)
Date: 2021-07
New Economics Papers: this item is included in nep-isf and nep-iue
Note: DEV PE
References: Add references at CitEc
Citations: View citations in EconPapers (12)

Published as Miguel Almunia, Jonas Hjort, Justine Knebelmann, Lin Tian; Strategic or Confused Firms? Evidence from “Missing” Transactions in Uganda. The Review of Economics and Statistics 2022

Downloads: (external link)
http://www.nber.org/papers/w29059.pdf (application/pdf)

Related works:
Journal Article: Strategic or Confused Firms? Evidence from “Missing” Transactions in Uganda (2024)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:29059

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w29059

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().