Journal of Economic Perspectives
ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)
Tax Privacy
Journal of Economic Perspectives
vol. 39,
no. 1, Winter 2025
(pp. 205–24)
(Complimentary)
Abstract
Implementing an equitable and efficient tax system requires that the government have access to certain information about taxpayers. If the demand for privacy implies limiting government's access to relevant information, it constrains the extent to which a tax system can achieve these goals. In this way, demand for limiting government access to information imposes social costs. This article discusses the aspects of privacy that matter, including leaks, and explores certain countries' public disclosure of taxpayer information. It then discusses what is known about, and the difficulties of ascertaining, how taxpayers value tax privacy, whether offering choices to taxpayers about information revelation can ease the tension between privacy and otherwise optimal tax policy, and uses the wealth tax as an example of the policy tradeoffs that arise.Citation
Slemrod, Joel. 2025. "Tax Privacy." Journal of Economic Perspectives 39 (1): 205–24. DOI: 10.1257/jep.20241431Additional Materials
JEL Classification
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- H24 Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
- H25 Business Taxes and Subsidies including sales and value-added (VAT)
- H26 Tax Evasion and Avoidance
- K34 Tax Law