Using Internal and External Sources of Information to Reduce Customs Evasion

Cyril Chalendard
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Cyril Chalendard: CERDI - Centre d'Études et de Recherches sur le Développement International - UdA - Université d'Auvergne - Clermont-Ferrand I - CNRS - Centre National de la Recherche Scientifique

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Abstract: This paper aims to identify some factors that reduce evasion of customs duties in developing countries. Following the recent literature on customs evasion, we proxy customs fraud by discrepancies in bilateral trade statistics. Estimates first show that the more frequently a product is imported, the more customs fraud reduces. We argue that this result is indicative of the fact that customs officers use what they have learned from similar import declarations - use customs' internal information - to better assess the compliance of declarations. Then, we show that relying on an information provider - a pre-shipment inspection company in our case - seems to increase tax enforcement. Results indicate that pre-shipment inspections significantly reduce observed discrepancies in trade statistics. In line with previous studies, we find that the semi-elasticity of evasion increases with the tax rate. Finally, estimates confirm that enforcement is product-varying. Results are robust to various robustness checks.

Keywords: Use of internal information; External Information acquisition; Customs enforcement; Tax evasion; Pre-shipment inspections. (search for similar items in EconPapers)
Date: 2017-02-01
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01451381
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