EconPapers    
Economics at your fingertips  
 

Targeting in tax behavior: Evidence from Rwandan firms

Gabriel Tourek

Journal of Development Economics, 2022, vol. 158, issue C

Abstract: This paper describes tax behavior among firms in a low-income country that diverges from traditional models of compliance. Using the universe of administrative filings in Rwanda, I find that many firms consistently pay identical amounts in income tax year after year. Evidence from a survey of filers, matched to administrative filings, suggests that constraints on documenting and verifying earnings motivates a heuristic of targeting past payment amounts. To illustrate the policy relevance of this behavior, I exploit an income tax reform to show that targeting can reconcile perverse responses to tax changes: when taxes are cut, firms relying on this heuristic on average persist in paying as much as they did before.

Keywords: Economic history; Trade empirical; Firms; Policy reforms; Africa - macro (search for similar items in EconPapers)
JEL-codes: D90 H25 O17 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0304387822000700
Full text for ScienceDirect subscribers only

Related works:
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:eee:deveco:v:158:y:2022:i:c:s0304387822000700

DOI: 10.1016/j.jdeveco.2022.102911

Access Statistics for this article

Journal of Development Economics is currently edited by M. R. Rosenzweig

More articles in Journal of Development Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2023-01-03
Handle: RePEc:eee:deveco:v:158:y:2022:i:c:s0304387822000700