What was a significant impact of reliance on voluntary compliance in revenue collection?

Reliance on voluntary compliance in revenue collection often leads to higher rates of tax delinquency. This occurs because when taxpayers are not required by stringent enforcement measures to comply with tax laws, some may choose not to pay their taxes. Voluntary compliance depends on the willingness of taxpayers to follow tax laws without aggressive measures to ensure payment, such as audits or penalties. When individuals and businesses believe they can evade their tax responsibilities with little risk of consequences, it can result in increased noncompliance, ultimately affecting government revenue.

Higher tax delinquency can strain government resources and may necessitate the implementation of more rigorous enforcement actions to ensure that taxes are collected, thereby impacting the overall efficiency and effectiveness of the revenue collection system.