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CANCEL – Bertrand GARBINTI (CREST) – “Information Regime and Tax Elasticities: Evidence From the French Wealth Tax”

October 18, 2022 @ 12:15 pm - 1:30 pm

Applied Micro seminar : Every Tuesday
Time: 12:15 pm – 13:30 pm
Date: 18 th of October 2022
Room : 3001

Bertrand GARBINTI (CREST) – “Information Regime and Tax Elasticities : Evidence From the French Wealth Tax”

Abstract : We study a reform of the French wealth tax that dramatically reduced the amount of information that taxpayers must self-report below a certain level of wealth. Combining administrative micro-data with dynamic bunching and difference-in-differences approaches, we find large behavioral responses to this switch to a low-information regime. The reform caused a 0.5 percentage points average decrease in the annual growth rate of wealth reported by treated taxpayers each year following the switch to the low-information regime. This reduction is driven by a 4 percentage points decrease for taxpayers bunching at the information discontinuity threshold. Consistent with opacity leading to lower compliance, treated households do not experience a real change in their (third-party) reported labor and capital income. The wealth tax base becomes much more elastic in the low-information regime, illustrating the first-order role of information policy choices for tax base elasticities.

joint work  : Jonathan Goupille-Lebret, Mathilde Munoz, Stéfanie Stantcheva and Gabriel Zucman

Benoît SCHMUTZ (Pôle d’économie du CREST)
Roland RATHELOT (Pôle d’économie du CREST)