The Effect of Late Payment Penalties on the Payment Timing of Owed Taxes
The Effect of Late Payment Penalties on the Payment Timing of Owed Taxes
Date
2023-06
Authors
Skov, Peer Ebbesen
Supervisor
Item type
Journal Article
Degree name
Journal Title
Journal ISSN
Volume Title
Publisher
Elsevier BV
Abstract
This paper studies the effectiveness of a policy designed to influence the timing decision for payments of owed taxes. Owed taxes arise when the sum of the foregoing tax year’s preliminary tax payments falls short of the total tax liability. In 2009 the Danish tax authority (SKAT) introduced an annualised penalty rate of 4.6%. Using administrative tax data, I show that the penalty rate introduction led to a 50-day advancement of payments.
Description
Keywords
14 Economics , Economics , 38 Economics
Source
Economics Letters, ISSN: 0165-1765 (Print), Elsevier BV, 111200-111200. doi: 10.1016/j.econlet.2023.111200
Publisher's version
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Copyright © 2023 Elsevier Ltd. All rights reserved. This is the author’s version of a work that was accepted for publication in (see Citation). Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. The definitive version was published in (see Citation). The original publication is available at (see Publisher's Version).