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Abstract
We analyze the reporting response to an ambitiously targeted support scheme for Norwegian businesses at the very start of the Corona virus crisis in 2020. Our empirical design is based on cross-checking the self-reported data in the applications for support with administratively reported data used for VAT. We find strong evidence that strategic misreporting was present but conclude that its remaining quantitative extent after the enforcement actions already taken by the tax authorities was relatively small.
Firms tend to misreport 4 percent more often than expected and the actual support paid out was 5 percent higher than what it should have been. We discuss possible reasons for the relatively limited extent of non-compliance and
more general lessons for the design of transfer programs.