Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/173030
Authors: 
Asatryan, Zareh
Peichl, Andreas
Year of Publication: 
2017
Series/Report no.: 
CESifo Working Paper 6754
Abstract: 
Using panel data on the full population of corporate tax returns from Armenia, we study behavioral responses of firms to three size-dependent regulations. We find: i) a strong response to an accounting notch where IFRS becomes mandatory; ii) a moderate response to an administrative notch below which the frequency of filing taxes declines; and iii) no response to the VAT registration threshold notch. Exploiting tax audits, we provide evidence suggesting that income under-reporting drives the bunching response of firms. Additional evidence suggests that firms respond to audits by compensating additional reported income by a 0.90 dollar increase in deductions.
Subjects: 
small and medium enterprises
size-dependent regulation
value added tax
tax administration
tax accounting
tax evasion
JEL: 
H25
H26
O12
Document Type: 
Working Paper

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