Tax Simplicity or Simplicity of Evasion? Evidence from Self-Employment Taxes in France

Philippe Aghion, Maxime Gravoueille, Matthieu Lequien and Stefanie Stantcheva
Authors registered in the RePEc Author Service: Ufuk Akcigit

No 24049, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Tax systems are often criticized for being overly complex, leading some countries to offer simplified regimes to some taxpayers. Using panel data on French income tax returns, we show that simplified regimes for the self-employed create substantial bunching just below their eligibility thresholds. This bunching in turn is driven not only by a pure taste for simplicity but also by tax evasion. We then develop a structural model to quantify the relative importance of these two motives. Our estimates reveal a significant preference for simplicity–valued at 49 to 495 euros annually per self-employed worker–alongside a sizable evasion elasticity.

JEL-codes: H21 H24 H25 H26 (search for similar items in EconPapers)
Date: 2017-11
New Economics Papers: this item is included in nep-eur, nep-pbe and nep-pub
Note: LS PE
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Citations: View citations in EconPapers (30)

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Related works:
Working Paper: Tax simplicity or simplicity of evasion? Evidence from self-employment taxes in France (2024)
Working Paper: Tax Simplicity or Simplicity of Evasion? Evidence from Self-Employment Taxes in France (2024)
Working Paper: Tax simplicity or simplicity of evasion? Evidence from self-employment taxes in France (2024)
Working Paper: Tax simplicity or simplicity of evasion? Evidence from self-employment taxes in France (2023)
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