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- How choice architecture can promote and undermine tax compliance
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How choice architecture can promote and undermine tax compliance: testing the effects of prepopulated tax returns and accuracy confirmation
We tested the effects of prepopulated returns and accuracy confirmation on compliance. Participants were asked
to report correct liabilities for different types of returns, whereby some had to confirm the accuracy of each
reported liability and others not. Results showed that correctly prefilled returns yielded the highest rate of
compliance, followed by returns that were not prefilled, followed by returns that overestimated liabilities, and
with returns that underestimated liabilities displaying the lowest compliance. Moreover, accuracy confirmation
increased compliance only for returns that overestimated liabilities. The present study indicates that both
morality and defaults play a pivotal role in shaping the effects of prepopulated returns on compliance. Our
findings imply that prepopulating tax returns should be done with care, because it can increase tax compliance
when done correctly, but undermine it when done incorrectly.
- All authors
- Dijk, W.W. van; Goslinga, S.; Terwel, B.W.; Dijk, E. van
- Date
- 2020-06-17
- Volume
- 87
- Pages
- 101574