Toward evidence-based tax administration
Abstract
An evidence-based approach is being promoted and adopted in many public
service areas, but tax authorities have so far only sporadically subscribed to it.
We, first, present arguments for an evidence-based approach to tax administration
and outline its main features. Second, studies on the effects of tax-reporting
schedules are considered to illustrate the logic, potential challenges and outcomes
of such an approach. Third, we discuss the main principles of an evidence-based
approach, as well as its practical and political obstacles in the context of taxation.
An evidence-based approach means basing administrative practices and strategies
on an understanding of relevant processes that is obtained from systematic, theory-driven
and cumulative research, using various appropriate methodologies including
experimental and quasi-experimental evaluation designs. However, an evidence-based
approach needs to consider the challenges posed by short-term orientation
and risk-averse defensive postures that result from political agendas, public media
scrutiny and intra-organisational dynamics.