Three Policies: Nonfiler Tax Enforcement, Renewable Fuel Credits, and Leverage Requirements

Tax Evasion;Income Tax;Renewable Fuel Standard;Capital Requirements;Macroprudential Regulation;Economics;Business and Economics;Economics

Meiselman, BenKellogg, Ryan Mayer ;

University of Michigan

关键词: Tax Evasion;    Income Tax;    Renewable Fuel Standard;    Capital Requirements;    Macroprudential Regulation;    Economics;    Business and Economics;    Economics;   

Others  :  https://deepblue.lib.umich.edu/bitstream/handle/2027.42/138445/mdbmeis_1.pdf?sequence=1&isAllowed=y

瑞士|英语

来源: The Illinois Digital Environment for Access to Learning and Scholarship

【 摘 要 】

This dissertation comprises three research papers, each of which examines a public policy.Chapter 1. Many people who owe income tax fail to file a timely tax return. In communication with these ;;ghosts,” what messages from the tax authority are effective for eliciting a return? This is the first study to address message content in communication with income tax nonfilers. I assess the efficacy of messages related to penalty salience, punishment probability, compliance cost, and civic pride by evaluating the response to experimental mailings distributed by Detroit to 7,142 suspected resident nonfilers. The penalty salience message was the most effective. Relative to a basic mailing that requested a return, penalty salience mailings that stated the statutory penalty for failing to file a return tripled response rates from 3% to 10%, increased the number of back-year returns filed per response from 0.08 to 0.27, and raised the fraction of filed returns that admitted tax due from 39% to 52%. Compliance cost mailings that enclosed a blank tax return and punishment probability mailings that stated the recipient;;s federal income also raised response rates relative to the basic mailing, but civic pride mailings did not. Mailings were more effective in eliciting returns from older, higher-income, and first-time nonfilers. I investigate the impact of treatment mailings on the behavior of untreated neighbors and find no evidence of geographic network effects.Chapter 2. Two peculiar features of the market for renewable fuel are essential for understanding the welfare consequences of the Renewable Fuel Standard (RFS). First, the 10% limit on ethanol in E10 gasoline—the blendwall—makes the total renewable fuel mandate more costly. Second, the linkage among prices of different categories of renewable energy credits—RINs—makes the total renewable fuel mandate less costly. I simulate policy experiments in a model that captures both of these features. In the short run, I find that reducing carbon emissions using the RFS imposes welfare costs of more than $300 per metric ton of CO2.Chapter 3. The financial crisis focused attention on policies for managing systematic risk. One policy tool for managing systematic risk is bank leverage requirements, yet existing models do not consider the contribution of leverage to the frequency of financial crises. This paper develops a criterion for optimal leverage requirements when bank leverage makes financial crises more likely. Despite the contribution of leverage to systematic risk, it is optimal to tolerate leverage because it helps banks create liquidity. I provide illustrative calculations that show current requirements are too low.