Digital Prompts, Audits, and Penalties: The Spectrum of Tax Enforcement and Compliance

Last registered on March 18, 2025
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Pre-Trial

Trial Information

General Information

Title
Digital Prompts, Audits, and Penalties: The Spectrum of Tax Enforcement and Compliance
RCT ID
AEARCTR-0015550
Initial registration date
March 13, 2025

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
March 18, 2025, 11:30 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Country
Norway
Region

Primary Investigator

Name
Andreas Kotsadam
Affiliation
University of Oslo
Contact Primary Investigator

Other Primary Investigator(s)

Additional Trial Information

Status
On going
Start date
2024-06-02
End date
2028-02-20
Keywords
Behavior, Governance
Additional Keywords
Tax audits
JEL code(s)
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
This pre-analysis plan presents a study that aims to measure the effects of real-time digital prompts, audits and penalty tax on tax compliance for taxpayers who have self-reported a reduction in wage income pre-filled by third parties. We set up a large-scale RCT for this target population, where we randomize (i) whether or not the taxpayer gets a prompting message when attempting to reduce their wage income in the digital tax return, (ii) whether or not the taxpayer is audited after the reduction, and finally (iii) whether or not the non-compliant taxpayer is punished with penalty tax. This experimental design allows us to identify the effects that each of these policy instruments have on tax compliance in the current or subsequent income year. The control groups for the audits and the penalty tax are treated later to ensure equal treatment so we are not investigating longer term effects. The focus of this plan is on the audit and tax penalty treatments and deviations from the plan will be highlighted in the future paper.
External Link(s)

Registration Citation

Citation
Kotsadam, Andreas. 2025. "Digital Prompts, Audits, and Penalties: The Spectrum of Tax Enforcement and Compliance." AEA RCT Registry. March 18. https://doi.org/10.1257/rct.15550-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
Together with the Norwegian Tax Authorities we set up a large-scale RCT, where we randomize (i) whether or not the taxpayer gets a prompting message when attempting to reduce their wage income in the digital tax return, (ii) whether or not the taxpayer is audited after the reduction, and finally (iii) whether or not the non-compliant taxpayer is punished with penalty tax.
Intervention Start Date
2025-05-04
Intervention End Date
2025-08-03

Primary Outcomes

Primary Outcomes (end points)
Total liable income tax
Primary Outcomes (explanation)
This variable does not include wealth tax but is otherwise equal to total liable taxes. Data comes from administrative records.

Secondary Outcomes

Secondary Outcomes (end points)
Claimed wage income, total taxes paid, and total taxable income
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Together with the Norwegian Tax Authorities we set up a large-scale RCT, where we randomize (i) whether or not the taxpayer gets a prompting message when attempting to reduce their wage income in the digital tax return, (ii) whether or not the taxpayer is audited after the reduction, and finally (iii) whether or not the non-compliant taxpayer is punished with penalty tax. See the pre-plan document for details.
Experimental Design Details
Not available
Randomization Method
Randomization done in office by a computer
Randomization Unit
Individual
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
1200 individuals
Sample size: planned number of observations
1200 individuals
Sample size (or number of clusters) by treatment arms
600 individuals in control and 600 individuals in treatment.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
With a sample of 1200 individuals and 80 percent power, we can detect effects as small as 0.16 standard deviations
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number
Analysis Plan

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