I thank Kazuo Ogawa for his guidance during the writing of this paper. I am grateful to Hirobumi Akagi, John E. Anderson, Shaohua Chen, Han Gwang Choo, Ali M. El-Agraa, David F. Hendry, Shinsuke Ikeda, Atsushi Kajii, Shi Li, Xuejun Liu, Carla Marchese, Caren Sureth, Satoshi Watanabe, Wako Watanabe, Qinhua Zhao, Kevin Honglin Zhang, and the participants for their valuable comments and suggestions when an earlier version of this paper was presented at Osaka University in 2004, the 2004 Autumn Meeting of Japanese Economic Association, the Yaohui Zhao research seminar at China Center for Economic Research of Peking University in 2006, the “WTO, China, and the Asian Economies, IV” in 2006, the 2008 Congress of International Institute of Public Finance, the seminar of Fukuoka University in 2008, the 2008 Autumn Meeting of Japanese Association for Applied Economics, the International Conference on Econometrics and the World Economy in 2009, respectively. I also thank Jianhuai Shi for the assistance in gathering data on tax revenues in Beijing. I finally give special thanks to Takao Fujimoto, Charles Yuji Horioka, Justin Yifu Lin, Hikaru Ogawa, Shangjin Wei, Kar-yiu Wong, Yaohui Zhao, and an anonymous referee for their beneficial suggestions and encouragement. Any remaining errors here are my responsibility.
1467-9361/asset/rode_left.gif?v=1&s=7543eda484383eae746a58d09ccee50a09c7ad9c)
The Incentive to Declare Taxes and Tax Revenue: The Lottery Receipt Experiment in China
Article first published online: 16 JUL 2010
DOI: 10.1111/j.1467-9361.2010.00577.x
© 2010 Blackwell Publishing Ltd
Issue
1467-9361/asset/cover.gif?v=1&s=2c36e56d4ddfe0ec8c70b9cfd742db75b196ad53 "Review of Development Economics")
Review of Development Economics
Special Issue: Guest Editor: Kar-yiu Wong
Volume 14, Issue 3, pages 611–624, August 2010
Additional Information
How to Cite
Wan, J. (2010), The Incentive to Declare Taxes and Tax Revenue: The Lottery Receipt Experiment in China. Review of Development Economics, 14: 611–624. doi: 10.1111/j.1467-9361.2010.00577.x
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I thank Kazuo Ogawa for his guidance during the writing of this paper. I am grateful to Hirobumi Akagi, John E. Anderson, Shaohua Chen, Han Gwang Choo, Ali M. El-Agraa, David F. Hendry, Shinsuke Ikeda, Atsushi Kajii, Shi Li, Xuejun Liu, Carla Marchese, Caren Sureth, Satoshi Watanabe, Wako Watanabe, Qinhua Zhao, Kevin Honglin Zhang, and the participants for their valuable comments and suggestions when an earlier version of this paper was presented at Osaka University in 2004, the 2004 Autumn Meeting of Japanese Economic Association, the Yaohui Zhao research seminar at China Center for Economic Research of Peking University in 2006, the “WTO, China, and the Asian Economies, IV” in 2006, the 2008 Congress of International Institute of Public Finance, the seminar of Fukuoka University in 2008, the 2008 Autumn Meeting of Japanese Association for Applied Economics, the International Conference on Econometrics and the World Economy in 2009, respectively. I also thank Jianhuai Shi for the assistance in gathering data on tax revenues in Beijing. I finally give special thanks to Takao Fujimoto, Charles Yuji Horioka, Justin Yifu Lin, Hikaru Ogawa, Shangjin Wei, Kar-yiu Wong, Yaohui Zhao, and an anonymous referee for their beneficial suggestions and encouragement. Any remaining errors here are my responsibility.
Publication History
- Issue published online: 16 JUL 2010
- Article first published online: 16 JUL 2010
- Abstract
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Abstract
Indirect tax such as sales tax collection is difficult as the government has difficulty monitoring the actual economic dealings. To bring out private information on transaction only known to a firm and a consumer, China's government has set up a lottery receipt system which has been tried out in many areas. This paper empirically examines the validity of this new system. Estimation is performed based on panel data for different periods during 1998–2003 from a total of 37 districts in Beijing and Tianjin. It is found that the lottery receipt experiment (LRE) has significantly raised the sales tax and the growth of sales tax and total tax revenues.