Economic and Political Determinants of Tax Amnesties in the U.S. States

Author/Editor: Eric Le Borgne
Publication Date: October 01, 2006
Electronic Access: Free Full text (PDF file size is 304KB).
Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
Summary: This paper revisits earlier studies on the determinants of tax amnesties. The novel findings are (i) amnesties are more likely to be declared during fiscal stress periods, and (ii) political factors significantly affect the introduction and timing of amnesties. In particular, the paper empirically disentangles opposite theoretical effects to show that governors perceive amnesties as another revenue source (rather than a tax increase alternative). Finally, supporting evidence shows that by breaking horizontal equity, amnesties might be perceived as unfair: a significant correlation exists between governors who lost their reelection bids and the introduction of a tax amnesty during their election years.
Series: Working Paper No. 06/222
Subject(s): Economic models | Political economy | Tax policy | Tax evasion | Tax revenues | United States

Author's Keyword(s): Tax amnesty | gubernatorial elections | Cox model
Publication Date: October 01, 2006
ISBN/ISSN: 9781451864823/1018-5941 Format: Paper
Stock No: WPIEA2006222 Pages: 13
US$18.00 (Academic Rate:
US$18.00 )
Please address any questions about this title to