Tax Design, Information, and Elasticities: Evidence From the French Wealth Tax

Bertrand Garbinti (), Jonathan Goupille-Lebret (), Mathilde Muñoz (), Stefanie Stantcheva and Gabriel Zucman ()
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Bertrand Garbinti: ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - GENES - Groupe des Écoles Nationales d'Économie et Statistique - IP Paris - Institut Polytechnique de Paris, CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - GENES - Groupe des Écoles Nationales d'Économie et Statistique - X - École polytechnique - IP Paris - Institut Polytechnique de Paris - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - GENES - Groupe des Écoles Nationales d'Économie et Statistique - IP Paris - Institut Polytechnique de Paris - CNRS - Centre National de la Recherche Scientifique, CEPR - Center for Economic Policy Research
Jonathan Goupille-Lebret: CERGIC - Center for Economic Research on Governance, Inequality and Conflict - ENS de Lyon - École normale supérieure de Lyon - Université de Lyon
Mathilde Muñoz: UC Berkeley - University of California [Berkeley] - UC - University of California, NBER - National Bureau of Economic Research [New York] - NBER - The National Bureau of Economic Research, CEPR - Center for Economic Policy Research
Stefanie Stantcheva: Department of Economics, Harvard University - Harvard University, NBER - National Bureau of Economic Research [New York] - NBER - The National Bureau of Economic Research, CEPR - Center for Economic Policy Research
Gabriel Zucman: PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - ENPC - École nationale des ponts et chaussées - IP Paris - Institut Polytechnique de Paris, UC Berkeley - University of California [Berkeley] - UC - University of California, NBER - National Bureau of Economic Research [New York] - NBER - The National Bureau of Economic Research, CEPR - Center for Economic Policy Research

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Abstract: Using exhaustive administrative wealth and income tax data, we study a French wealth tax reform that scaled back information reporting requirements below a certain wealth threshold. We develop a dynamic bunching approach that permits estimating the average response to the reform, the share of compliers, and the LATE. Reported wealth declines sharply in response to the reform and annual wealth growth rates are on average 20% lower among affected taxpayers. This decline appears due to increased evasion facilitated by the lower reporting requirements, as suggested by the fall in self-reported wealth but the lack of response in third-party-reported labor and capital incomes. By contrast, the elasticities to tax rates estimated are very small and insignificant. This illustrates the critical role of information reporting policies in shaping taxpayers' behavior.

Keywords: Wealth Tax; Wealth Reporting; Tax Avoidance; Tax Evasion; Bunching (search for similar items in EconPapers)
Date: 2025-09-19
Note: View the original document on HAL open archive server: https://hal.science/hal-05268640v1
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