Experimental Evidence on Performance Pay for Tax Collectors--论文代写范文精选

深入了解我们的研究，结果揭示了一个有趣的异质性问题，大多数纳税人没有得到重新评估或支付更高的税收,但是研究揭示了更高层次的贿赂和腐败的实例。下面的essay代写范文进行讲述。

Abstract 
Abstract Despite the importance of performance-based payment systems, there is little rigorous evidence on their impact in a civil service. In tax, high-powered incentives for tax collectors could increase revenues, but come at a high political cost if collectors exert excessive pressure on taxpayers. We report the results of the first large-scale, randomized field experiment designed to investigate these issues. Working with the entire property tax department in Punjab, Pakistan, we experimentally allocated collectors in the entire 482 property tax units into one of three performance-pay schemes or a control group. We find that incentivized units experience an average of 9 percentage points higher revenue growth than controls, and the effects persist over the two years of the experiment. Yet these units do not report greater taxpayer discontent. 

The performance pay scheme that rewarded purely on revenue collection does better, increasing revenue growth by 14 percentage points, with relatively little penalty for customer satisfaction and assessment accuracy compared to the two other schemes that explicitly rewarded these dimensions. Digging deeper into our findings reveals an interesting heterogeneity: most taxpayers in incentivized areas do not get reassessed or pay higher taxes, but do report higher level of bribes and instances of corruption. In contrast, conditional on their property being reassessed, taxpayers in incentivized areas pay higher tax and report less corruption. These results are consistent with a simple model of collusion between collector and taxpayer, in which taxpayers in incentivized areas either have to pay higher bribes to avoid being reassessed, or pay substantially higher taxes if the bargaining process breaks down. Our results suggest that while incentives for tax collectors can substantially boost revenue collected and lead to little overall discontent, they do empower the tax collector in a manner that can both lead to increased revenue and rents at the expense of the taxpayer.

Introduction 
Tax systems throughout the developing world collect substantially less revenue as a share of GDP than their counterparts in developed countries (Gordon and Li, 2009). While there are many sources of these differences, an important one may be in the role played by the tax officials who assess, audit, and enforce taxes. Due to the largely manual nature of tax administration in many developing countries and the comparative lack of third-party reporting, these officials play an important role in determining tax liabilities and enforcement. But, given relatively low wages and limited performance rewards, the temptations for tax inspectors to collude with taxpayers to reduce tax receipts are great. 

Historically, the state addressed this problem by rewarding tax collectors on the basis of tax collected. From the Roman Empire through the French Monarchy (Bartlett, 1994; White, 2004), regimes sold the rights to collect taxes to “tax farmers,” who then kept a fraction (or in some cases all) of the tax revenue they collected from a given area. But these regimes were often unpopular, as tax farmers used aggressive tactics to collect taxes. In fact, unhappiness over the aggressive techniques and substantial rents accruing to tax farmers was a contributor to the French Revolution, and tax farmers were among those guillotined in 1794. US states similarly experimented with highly incentivized “tax ferrets” to collect property taxes in the 19th century, but again this fell out of favor. 

More generally, over the past several hundred years the world has moved increasingly to salaried tax officials (Parrillo, 2013). In developed countries with well functioning civil service systems, reliable financial and administrative data, and third party verification methods (Gordon and Li, 2009; Kleven et al., 2011), there has been relatively little appetite for revisiting this debate, perhaps because the perceived benefits are outweighed by the costs. But in developing countries, where tax inspectors are poorly compensated, corruption is considered rampant, and there is limited and only partial administrative and third party data to draw on (e.g., Carillo, Pomeranz and Singhal, 2014), this tradeoff is not as obvious. 

Not surprisingly some countries such as Brazil, Pakistan, and others have begun to reconsider incentives for tax staff. Yet there is little rigorous evidence of the tradeoffs developing country governments face between increased revenue from incentives and the political costs that may occur as a result of a disgruntled citizenry. In this paper, we provide what is to the best of our knowledge the first experimental evidence on this question. Working with the Punjab, Pakistan provincial government, we randomly allocated tax officials in the entire provincial urban property tax department, consisting of 482 property tax units (known as circles), into one of three versions of performance-based pay schemes or a control group. A total of 218 circles , consisting of about 550 tax personnel , were randomly allocated to one of the three treatment groups, for up to two full fiscal years. 

The incentives were large: the 3 tax personnel in each circle were collectively given an average of 30 percent of all tax revenues they collected above a historically-predicted benchmark.1 Many personnel in treated areas were able to double their base salaries through these incentives . Given the historical concerns about potential negative impacts of high-powered incentives on taxpayer satisfaction and fairness, the three schemes varied in both the extent to which they also based performance pay on non-revenue outcomes (as a means of potentially mitigating political cost on taxpayers) and the extent to which they allowed for more subjective evaluation on the part of the tax department. The “Revenue” scheme provided incentives based solely on revenue collected above a benchmark predicted from historical data. 

The “Revenue Plus” scheme provides incentives exactly as in the Revenue scheme, but makes adjustments equal to about +/- three-fourths of base salary based on whether the circle falls in the top, middle, or bottom third of circles in terms of taxpayer satisfaction and accuracy of tax assessments, as determined by an independent survey of taxpayers. Explicitly providing these multi-dimensional incentives might mitigate some of the political costs that were the downfall of tax farming historically. The third scheme, “Flexible bonus,” took this a step further by both rewarding collectors for a much wider set of pre-specified (by the tax department) criteria, and by allowing for subjective adjustments based on period-end overall performance. 

It is important to note that the impact of even the revenue only scheme on tax revenues and corruption is not, ex-ante, obvious. Consider a simple bargaining setting in which a tax collector colludes with a taxpayer to reduce the tax assessment in exchange for a bribe. If there is no cost to either party from reducing tax liability, then performance pay for tax collectors will simply raise the bribe paid with no impact on revenue, as the taxpayer now has to compensate the collector’s foregone incentive payment with a higher bribe. In more realistic settings, where there is some cost to either party from reduced tax liabilities, then there will be two different effects: some taxpayers will continue in the collusive, low-tax equilibrium but with higher bribes, while others will end up paying higher taxes and lower bribes as they switch from the collusive, low-tax equilibrium to a non-collusive, high-tax equilibrium. 

Performance pay thus could have heterogeneous effects on tax revenue and bribes among taxpayers. We evaluate the impact of the schemes using multiple sources of data. To evaluate the impact on tax revenues, we obtained quarterly administrative data on tax revenue collected for each circle, which we verified by conducting random spot-checks against the tax department’s bank records. To evaluate the impact on other outcomes, such as corruption and tax accuracy, we conducted a survey of over 16,000 properties throughout the province, in which our surveyors asked property owners about their perception of corruption in and sense of satisfaction with the tax department. The surveyors also directly observed the characteristics of each property that are used in the tax calculation, and then manually matched each property to the tax rolls to obtain the corresponding tax records for each property. Since tax assessment is determined formulaically from these property characteristics, with no subjectivity on the part of the inspector, we can determine the accuracy of assessments by comparing our measurements to those on the official tax rolls.

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