Wealth tax enforcement:The role of tax and institutional design

José María Durán-Cabré (), Alejandro Esteller-Moré (), Christos Kotsogiannis and Luca Salvadori ()
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José María Durán-Cabré: Universitat de Barcelona & IEB
Alejandro Esteller-Moré: Universitat de Barcelona & IEB
Christos Kotsogiannis: Tax Administration Research Centre (TARC), University of Exeter Business School & CESIfo
Luca Salvadori: Universitat Autònoma de Barcelona & BSE & IEB & Tax Administration Research Centre (TARC), University of Exeter Business School

No 2025/15, Working Papers from Institut d'Economia de Barcelona (IEB)

Abstract: Enforcing wealth tax compliance among high-net-worth individuals is particularly challenging. Using administrative data on the Net Wealth Tax for Catalan taxpayers over the 2011–2020 period, this paper evaluates the impact of audits on voluntary compliance. The evidence suggests that wealth tax audits do enhance compliance, but the impact is short-lived — and driven by taxpayers rebalancing their tax evasion and avoidance responses. On the institutional side, the results indicate that Spain’s overlapping tax audit mandates can create coordination frictions that reduce the efficiency and effectiveness of audit-based enforcement of the New Wealth Tax. Effective enforcement depends not only on robust audit strategies, but also on coherent institutional design and sound tax policy.

Keywords: Tax Audit Evaluation; Overlapping Tax Audit Mandates; Wealth Tax; Tax Evasion; Tax Compliance (search for similar items in EconPapers)
JEL-codes: D02 D31 H26 O17 (search for similar items in EconPapers)
Pages: 57 pages
Date: 2025
New Economics Papers: this item is included in nep-inv and nep-iue
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https://ieb.ub.edu/publication/2015-15-wealth-tax- ... nstitutional-design/

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Persistent link: https://EconPapers.repec.org/RePEc:ieb:wpaper:doc2025-15

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