The tax auditing parameters have scarcely been analyzed by the literature as relevant policy-making instruments; however the enforcement strategies are crucial elements of the tax burden. In this paper we show that in a federal framework the tax auditing policies could represent additional tools on which regional institutions can interact between them. We investigate the presence of this interaction by means of a spatial econometric approach. We employ a time-space recursive model that accounts for sluggish adjustment in the auditing policies obtaining results congruent with standard theory and corroborating the presence of horizontal competition between regions on tax auditing policies. Moreover we find that once regional governments have legal power, the opaque competition on enforcement policies disappears and supposedly it switches to a more transparent competition on statutory tax parameters.