The Effects of Media Campaigns on Individual Attitudes towards Tax Compliance; Quasi-experimental Evidence from Survey Data in Pakistan

Musharraf Rasool Cyan (cyan@gsu.edu), Antonios Koumpias and Jorge Martinez-Vazquez (jorgemartinez@gsu.edu)
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Musharraf Rasool Cyan: Department of Economics, International Center for Public Policy. Andrew Young School of Policy Studies, Georgia State University, http://icepp.gsu.edu

International Center for Public Policy Working Paper Series, at AYSPS, GSU from International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University

Abstract: Pakistan has consistently performed low on taxation, with revenue collection hovering around 10 percent of GDP. Tax reforms have been attempted but without significant gains in revenue collection. Due to the recalcitrance of tax revenues, the tax authority attempted to enlist voluntary compliance as one of the avenues for its efforts to increase collections. This paper examines the effectiveness of media campaigns in the TV and national newspapers used by the Federal Board of Revenues of Pakistan to increase awareness, tax filing, and, ultimately, tax morale. We use survey data that were collected in 2014 immediately after a communication campaign by PakistanÕs Federal Board of Revenue. Using coarsened exact matching, we construct treatment and control groups that are nearly identical in terms of pre-treatment balance of demographic and behavioral predictors of high tax morale. We find improved perceptions towards tax compliance in Pakistan for respondents exposed to the TV and newspaper advertisements. The choice of the advertisementÕs delivery device is important since the latter is more effective. Our findings provide empirical evidence that well timed campaigns can enhance voluntary compliance in tax filing.

Pages: 28 pages
Date: 2016-10
New Economics Papers: this item is included in nep-iue
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