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Using Internal and External Sources of Information to Reduce Customs Evasion

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  • Cyril CHALENDARD

Abstract

This paper aims to identify some factors that reduce evasion of customs duties in developing countries. Following the recent literature on customs evasion, we proxy customs fraud by discrepancies in bilateral trade statistics. Estimates first show that the more frequently a product is imported, the more customs fraud reduces. We argue that this result is indicative of the fact that customs officers use what they have learned from similar import declarations - use customs' internal information - to better assess the compliance of declarations. Then, we show that relying on an information provider - a pre-shipment inspection company in our case - seems to increase tax enforcement. Results indicate that pre-shipment inspections significantly reduce observed discrepancies in trade statistics. In line with previous studies, we find that the semi-elasticity of evasion increases with the tax rate. Finally, estimates confirm that enforcement is product-varying. Results are robust to various robustness checks.

Suggested Citation

  • Cyril CHALENDARD, 2017. "Using Internal and External Sources of Information to Reduce Customs Evasion," Working Papers 201701, CERDI.
  • Handle: RePEc:cdi:wpaper:1856
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    File URL: http://publi.cerdi.org/ed/2017/2017.01.pdf
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    Cited by:

    1. Joël CARIOLLE & Cyril CHALENDARD & Anne-Marie GEOURJON & Bertrand LAPORTE, 2017. "Going beyond analysis of internal data to support customs modernization: a case study in Gabon," Working Papers P173, FERDI.
    2. Joel CARIOLLE & Cyril CHALENDARD & Anne-Marie GEOURJON & Bertrand LAPORTE, 2016. "Décloisonner l’analyse des données pour appuyer la modernisation des douanes : une illustration à partir du Gabon," Working Papers 201618, CERDI.
    3. repec:idq:ictduk:16548 is not listed on IDEAS
    4. Fawzi Banao & Bertrand Laporte, 2022. "Terrorism, Customs and fraudulent Gold exports in Africa," CERDI Working papers hal-03889094, HAL.

    More about this item

    Keywords

    Use of internal information; External Information acquisition; Customs enforcement; Tax evasion; Pre-shipment inspections.;
    All these keywords.

    JEL classification:

    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • H83 - Public Economics - - Miscellaneous Issues - - - Public Administration
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

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