HOW INFORMATION ON TAX EXPENDITURE CAN AFFECT TAX COMPLIANCE

Since current interest in co-operative methods regarding tax compliance has been increasing and it is crucial to establish trusted and reliable relationships between the taxpayers and public administration (OECD, 2016), a pilot experiment has been conducted to measure the effect that "information on tax expenditure" has on tax compliance. Information is considered as a trust-factor in this analysis. I conducted two incentivized pilot experiments: one at the University of Padua (Italy), and one at the Sorbonne University Panthéon Paris 1 (France), both with master students in economic disciplines. The pilot experiments are based on a survey in which participants were asked to give an ethical judgment regarding hypothetical tax evasion behaviors. Each pilot experiment consists of two treatments that vary based on the information provided regarding tax expenditure. Two regressions were run for each university sample: one for question 1 concerning the payment of bus tickets; one for question 2 concerning the payment of waste taxes. The results stated that information on tax expenditure was significant only in question 1 in the Italian sample. Despite the effectiveness of the experimental design the samples were still too small and this may have affected the significance of the effects in the regression. Therefore, it is valuable to further investigate these effects with larger samples. The framework and the structure of this experiment has to be considered extremely powerful and can be replicated in different contexts.