Findlay Ronald E. author Columbia University. Economics Wellisz Stanislaw H. author Columbia University. Economics Columbia University. International and Public Affairs Columbia University. Economics contributor originator text Working papers New York Department of Economics, Columbia University 2003 The collection of taxes, in any economic system, clearly requires the use of resources. In modern democratic states tax legislation is almost always controversial, and subject to extensive lobbying. In developing counties the wealthy often successfully avoid payment of taxes and the burden has to be borne by relatively impoverished rural classes, who are themselves not easy to tax directly because of poor record -keeping and difficulty of communications. In earlier times kings and princes often lacked the necessary means of direct taxation and were forced to rely on decentralized institutions such as feudalism. To convince the skeptical reader that the issue of tax-collection costs is neither trivial nor obvious, we pose the following question. What is the effect of greater efficiency in tax collection on the welfare of the tax-paying public? If the government is benign, taxing only to defray socially necessary public expenditure, a reduction in the costs of collecting these minimal taxes would clearly be a 'good thing'. What, however, if the state is inherently "predatory" in nature, as argued by Brennan and Buchanan (1980) and a number of others? In this case the state taxes not only to pay for public services but also to raise revenue for its own, possibly nefarious, purposes. Would an increase in the efficiency if tax-collection be undesirable under this alternative scenario? Economics Public policy 0304-02 http://hdl.handle.net/10022/AC:P:501 English NNC NNC 2011-03-24 10:47:02 -0400 2011-06-21 16:27:59 -0400 3238 eng