New and Current Evidence on Determinants of Aggregate Federal Personal Income Tax Evasion in the United States

Cebula, Richard J.

doi:10.1111/ajes.12020

Cited by 18 publications

(10 citation statements)

References 26 publications

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“…Repaying evaded tax plus tax fine will decrease total expected utility, and hence discourage tax evasion. Although theoretically giving positive impact, many empirical researches have demonstrated that the impact of audit on tax compliance is not as strong as expected and tends to be inconsistent (Kirchler et al, 2008 (Cebula, 2013) or special rate (Kim, 2008).…”

Section: Tax Evasion Deterrence Approach and Hypothesesmentioning

confidence: 94%

Is deterrence approach effective in combating tax evasion? A meta-analysis

Dularif

Sutrisno

Nurkholis

et al. 2019

Problems and Perspectives in Management

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The purpose of this paper is to present the results of a meta-analysis of the relationship between determinant factors and tax evasion based on deterrence approach. Using the meta-analysis method, each statistical result of empirical studies is converted into r-pearson as standardized effect size, and then synthesized into a mean effect size in order to increase power and to resolve uncertainty. Theoretically, increasing audit, tax rate and tax penalty will decrease tax evasion. However, the results show that only tax rate has a significant impact on tax evasion. Synthesizing totally 478 outcomes from articles published between 1978 and 2018, there is a robust conclusion that decreasing tax rate is an effective tool in combating tax evasion. On the other hand, audit and penalty are not significant in influencing tax evasion. In addition, the results of heterogeneity analysis suggest that national culture and income level of the country are useful in explaining the impact of audit, tax rate and tax penalty on tax evasion. These findings should be of interest to policymakers. First, instead of sacrificing more resources in conducting audit or imposing more penalty, tax authorities should consider setting the tax rate as low as possible to diminish tax evasion. Second, considering that culture and income level influence the impact of audit and penalty on tax evasion, policymakers should consider national cultural values and income level condition when designing audit techniques and setting penalty structures.

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Section: Tax Evasion Deterrence Approach and Hypothesesmentioning

confidence: 94%

Is deterrence approach effective in combating tax evasion? A meta-analysis

Dularif

Sutrisno

Nurkholis

et al. 2019

Problems and Perspectives in Management

View full text Add to dashboard Cite

show abstract

“…Our study moves beyond the attempts to experimentally manipulate morale to quantify the impact of naturally occurring quasi-experimental variation in attitudes toward government on evasion, as measured by IRS administrative data. From this perspective, the most closely related predecessor is Cebula (2013), showing that the IRS time series on aggregate evasion is predicted by the public's dissatisfaction with government. Using more plausibly exogenous variation in attitudes, we confirm a causal link.…”

Section: Literature On Tax Moralementioning

confidence: 98%

Political Alignment, Attitudes Toward Government, and Tax Evasion

Cullen

Turner

Washington

2021

American Economic Journal: Economic Policy

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We ask whether attitudes toward government play a causal role in the evasion of US personal income taxes. As turnover elections move voters in partisan counties into and out of alignment with the party of the president, we find with alignment (i) taxpayers report more easily evaded forms of income; (ii) suspect EITC claims decrease; and (iii) audits triggered and audits found to owe additional tax decrease. Coupled with evidence that alignment leads to more favorable views on taxation and spending, our results provide real world evidence that a positive outlook on government lowers tax evasion. (JEL D72, H24, H26, H31)

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“…Tax rate denotes the quantum of tax that a taxpayer pays in accordance with the taxable items and tax laws. Several studies in both developed and across developing countries have been undertaken in the domain of tax noncompliance and tax rate, and the findings show there is positive relationship (Guldana, 2013;Freire-Seré n & Panadé s, 2013;Cebula, 2013;Abiola & Asiweh, 2012;Mughal & Akram, 2012;Muhrtala & Ogundeji, 2013;Gurama, 2015;Ayuba et al, 2016;Sinnasamy & Bidin, 2017). Overall, these studies have shown that the tax rate is directly related to the taxpayers' ability to behave positively or negatively based on their opinion of tax noncompliance.…”

Section: Tax Ratementioning

confidence: 99%

Corruption and Tax Noncompliance Variables: An Empirical Investigation From Yemen

Obaid

Udin²

2020

IJFR

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Tax revenue is an important source of income for various governments around the world. However, challenges, as a result of corruption and tax noncompliance behaviour among the taxpayers, are hindering the adequate generation of such revenues for the government. The objective of this study is to investigate the effect of corruption and other tax noncompliance variables on tax revenue generation in Yemen. The study used survey research design via a questionnaire to collect data from 264 individual taxpayers in the Hadhramout Governorate. The collected data was analyzed using SPSS to perform reliability test, descriptive statistics, multicollinearity test, and regression analysis. The findings of the study show that corruption and tax rate are positively related to tax noncompliance; income level is negatively related to tax noncompliance; whereas penalty rate and education level are positive but not related to tax noncompliance. The implication of the study is that the government and the tax authority should update and institute new tax laws and policies that could minimize corruption among their officials and create more awareness among the taxpayers on the importance of paying tax to the government, so as to increase their compliance behaviour.

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New and Current Evidence on Determinants of Aggregate Federal Personal Income Tax Evasion in the United States

Cited by 18 publications

References 26 publications

Is deterrence approach effective in combating tax evasion? A meta-analysis

Is deterrence approach effective in combating tax evasion? A meta-analysis

Political Alignment, Attitudes Toward Government, and Tax Evasion

Corruption and Tax Noncompliance Variables: An Empirical Investigation From Yemen

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