Tax amnesty programs could be even more successful

Twenty states in recent years have conducted tax amnesty programs, most of them with enormous success. In New York State, about 151,000 people sought to pay up without penalty in 1985-86, bringing $392 million to the treasury that otherwise might not have been collected.

Illinois raised $159.1 million; California, $146.8 million; and Michigan, $101.7 million. Massachusetts collected $86.3 million, about four times what it had projected.

Viewed as an investment, the plans did very well. New York spent $2.8 million to bring in 140 times that amount. Illinois spent $2 million, and California, $5.8 million.

The states also discovered continuing sources of revenue, because they were able to identify those who had heretofore eluded identification.

Moreover, the amnesty programs were generally followed by more disciplined administrative procedures to ensure that evasion wouldn't be so attractive in the future.

The question now is: With a United States Treasury estimate that more than $100 billion of federal revenue is lost because of under-reporting and nonreporting, might Congress consider an amnesty program?

Now there is more grist for the argument, with a study of amnesty programs which suggests there are ways to ensure their success.

Working under a fellowship from the Rockefeller Institute, Ram L. Chugh, an economist at the State University of New York at Potsdam, found that the most successful programs were followed by tougher penalties immediately thereafter.

Mr. Chugh found that guilt and gratitude were among the three most important motivations in successful programs. The other factor, cited most often of the three, was fear.

``Amnesty programs in several states were accompanied by warnings that tax enforcement would be much stricter after the amnesty period,'' Chugh said. And in the more successful programs, publicity reinforced those warnings.

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