Can Tax Compliance Research Profit from Biology?

Torgler, Benno

doi:10.1561/105.00000045

Cited by 11 publications

(10 citation statements)

References 44 publications

(57 reference statements)

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Likewise, even though post‐experimental questionnaire data may improve understanding of what happened during the experiment, researchers must keep in mind that behavioural activities during the experiment can affect how participants fill out the questionnaire. In addition, although repeated experimentation with the same participants over a certain period of time allows longitudinal study in both experiments and surveys (Torgler ), researchers continue to struggle with understanding mid‐ and long‐term effects.…”

Section: Resultsmentioning

confidence: 99%

“…Simulations are particularly valuable for exploring poorly understood situations or systems; in other words, when information about the rules or heuristics that govern the behaviour under study is limited (Simon ) . Given that the key challenges in tax compliance research are dynamic, it is unsurprising that an increasing number of studies in this area use agent‐based modelling (ABM) (Torgler ), which is a valuable method for identifying emergent behavioural patterns because it permits the introduction of realistic rules like bounded rationality or heterogeneous agents. In particular, ABM gives researchers the ability to generate data on such difficult topics as: the role of information and communication; beliefs, norms and emotions; and the contextual forces determining interaction patterns.…”

Section: Simulationmentioning

confidence: 99%

See 1 more Smart Citation

Tax Compliance and Data: What Is Available and What Is Needed

Torgler¹

2016

Australian Economic Review

Self Cite

View full text Add to dashboard Cite

After first providing an overview of useful survey data sources and commonly studied variables in the area of tax compliance, this article outlines the major tools and exploratory methods used in the field, including laboratory and field experiments, simulations and surveys. It also discusses future possibilities and the data required to progress in this area. It is thus particularly useful as a guide for those planning or just beginning to work in the tax compliance field.

show abstract

Section: Resultsmentioning

confidence: 99%

Section: Simulationmentioning

confidence: 99%

Tax Compliance and Data: What Is Available and What Is Needed

Torgler¹

2016

Australian Economic Review

Self Cite

View full text Add to dashboard Cite

show abstract

“…For example, the notion of ‘reciprocity' arises in large part from anthropology, and that of ‘adherence to group norms' from sociology. These theories may also move beyond the social sciences to the physical sciences, as argued recently by Torgler (). For example, biology may well help explain the ways in which a system (e.g.…”

Section: Some Future Directionsmentioning

confidence: 92%

What Motivates Tax Compliance?

Alm

2018

Journal of Economic Surveys

272

223

View full text Add to dashboard Cite

In this paper, I review and assess what we have learned about what motivates individuals to pay -or to not pay -their legally due tax liabilities. I focus on three specific questions. First, what does theory say about what motivates tax compliance? Second, what does the evidence show? Third, how can government use these insights to improve compliance? I conclude with some suggestionsand some predictions -for future research. 356 ALM measure of the individual's constant relative risk aversion. Using the definitions of I C and I N in equations (1) and (2), the expected utility maximization generated by the solution to equation (3) can be solved for the optimum amount of reported income R*. 9 Now suppose that R* is calculated for specific, realistic values of the various parameters. For example, if t = 0.4, f = 2, p = 0.02 and e = 1, then the individual will optimally report no income. Very large values for relative risk aversion are required to generate compliance consistent with actual country experience. When e = 3, reported income is only 14% of true income; when e = 5, it is still only 44%; when e = 10, it is 71%; and e must exceed 30 for compliance to exceed 90%. Even if the probability of detection is as (unrealistically) high as 30% (with t = 0.4 and f = 2), relative risk aversion must exceed 7 to generate compliance over 90%. However, existing field evidence on the coefficient of relative risk aversion using a variety of approaches suggests that e ranges between 1 and 2, and may even be as low as 0 (Friend and Blume, 1975;Hansen and Singleton, 1983;Hall, 1988;Chetty, 2006;Gandelman and Hernandez-Murillo, 2013). Risk aversion must be abnormally large for behaviour to be even roughly comparable to actual observed choices, even in many developing countries with low levels of compliance.Admittedly, there are reasons why this simplistic analysis somewhat overstates the problem with the standard expected utility approach. 10 Consider the United States as an example. First, a standard feature of many individual income tax systems is that a third party (e.g. the individual's employer) reports the relevant part of an individual's taxable income to the tax authority (and often also withholds income taxes on this reported taxable income). This third-party information increases significantly the chances that an individual who underreports income on a filed return will be detected, especially in its combination with employer source-withholding. 11 Second, the 'official' IRS audit rate somewhat understates 'actual' IRS audit policy. In fact, the IRS conducts a range of audits, and for many types of audits, the actual rates are quite high. Third and relatedly, while overall audit rates are quite low, among certain income and occupation classes, they are more frequent. Fourth, the IRS conducts a wide range of audit-type activities, including line matching and requests for information, and these activities are much more frequent. 12 Finally, it is individual perceptions of audit rates that influence behaviour, rather than...

show abstract

“…According to Van and Verboon (2010) Procedural fairness focus on the perception whether fair procedures and services are executed by the authority. Thibaut and Walker (1975) make a significant contribution to the justice literature by introducing their theory of procedural justice. Prior to the publication of their work, the justice literature was dominated by studies emphasizing the importance of distributive justice.…”

Section: Procedural Fairness and Tax Compliancementioning

confidence: 99%

Examining the Influence of Fairness Perception on Tax Compliance Behavior of the Libya Individual Taxpayers: The Moderating Tax Awareness and Tax Complexity

Sidik

Zandi

Ruhoma

2019

HSSR

View full text Add to dashboard Cite

Purpose of Study: This study examines the impact of the perceptions of fairness among Libyan taxpayers in the Libyan income tax system, where a multidimensional model of justice was introduced. This extends the definition of justice from one to distributive fairness and procedural fairness, along with tax awareness and tax complexity as moderators’ variables. This study is one of the first studies that test the impact of tax awareness and tax complexity as moderators’ variables on tax compliance behavior in a country. Methodology: Despite the importance of collecting taxes from individual taxpayers, it is a little known about the behavior of tax compliance in general in the Libyan context. This is important for tax authorities to identify behavioral factors that may hinder the successful tax compliance so that remedial action can be taken to improve compliance behavior. It remains currently a severe challenge for the Libyan tax authorities. Results: The results of this research will contribute significantly to the paucity of current literature on the role of tax awareness and tax complexities as moderators’ variables on tax compliance behavior, particularly in developing countries. The serial exploratory search design will be used in this study. The sub-squares analysis will be used to analyze the surveys.

show abstract

Can Tax Compliance Research Profit from Biology?

Cited by 11 publications

References 44 publications

Tax Compliance and Data: What Is Available and What Is Needed

Tax Compliance and Data: What Is Available and What Is Needed

What Motivates Tax Compliance?

Examining the Influence of Fairness Perception on Tax Compliance Behavior of the Libya Individual Taxpayers: The Moderating Tax Awareness and Tax Complexity

Contact Info

Product

Resources

About