The Impact of Corruption on Firm Tax Compliance in Transition Economies: Whom Do You Trust?

Alon, Anna; Hageman, Amy M.

doi:10.1007/s10551-012-1457-5

Cited by 86 publications

(70 citation statements)

References 67 publications

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“…Paying taxes in full is the key feature of such strategic choice, as it implies giving back to the community via an intermediary authority that the individual values and therefore sees its claims as legitimate. However, if an individual does not consider the recipients of these taxes (the tax office and the government) trustworthy and honest, or does not believe the rules by which the tax revenue is collected and/or spent to be fair, this is likely to undermine a positive attitude towards full compliance and justify adopting a norm of non-compliance (Alon and Hageman 2013;Kavka 1983;Kirchler et al 2008;Murphy 2004;Scholz and Lubell 1998). In such circumstances, the legitimacy of the government and of the tax office is weakened.…”

Section: Determinants Of Tax Morale: a Frameworkmentioning

confidence: 99%

“…The authority of the government may be further undermined when the link between the state's provision of benefits to individuals and firms and their contribution in taxes is perceived as broken (Welter and Smallbone 2011;Alon and Hageman 2013). In this situation, firms may migrate either partly or entirely beyond the sphere of legality 1 to the informal economy.…”

Section: Determinants Of Tax Morale: a Frameworkmentioning

confidence: 99%

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To Pay or Not to Pay? Business Owners’ Tax Morale: Testing a Neo-Institutional Framework in a Transition Environment

2017

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In order to understand how the environment influences business owner/managers' attitudes towards tax morale, we build a theoretical model based on a neo-institutionalist framework. Our model combines three complementary perspectives on institutions-normative, cultural-cognitive and regulatory-instrumental. This enables a broader understanding of factors that influence business owner-managers' attitudes towards tax evasion. We test the resulting hypotheses using regression analysis on survey data on business owner/managers in Latvia-a transition country, which has undergone massive institutional changes since it was part of the Soviet Union over 25 years ago. We find that legitimacy of the tax authorities and the government (normative dimension), feeling of belonging to the nation (cultural-cognitive dimension) and perceptions of the risk and severity of punishment (regulatory-instrumental dimension) are all associated with higher tax morale for business owners and managers.

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Section: Determinants Of Tax Morale: a Frameworkmentioning

confidence: 99%

Section: Determinants Of Tax Morale: a Frameworkmentioning

confidence: 99%

To Pay or Not to Pay? Business Owners’ Tax Morale: Testing a Neo-Institutional Framework in a Transition Environment

2017

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“…Various elements of the tax structure have been claimed to potentially cause this kind of misperception; among them two of the most important elements are the relative reliance on direct versus indirect taxes in the tax system and the complexity of the tax system (Mill, 1848;Buchanan, 1967;Buchanan 2 Studies in the reverse direction in investigating the impacts of corruption on taxation are somehow attracting more attention in the current literature. See, for example, Barreto and Alm (2003); Thornton (2008); Pani (2011) and Alon and Hageman (2012). and Wagner, 1978).…”

Section: Theoretical Hypothesesmentioning

confidence: 99%

Tax structure and corruption: cross-country evidence

Liu

Feng

2014

Public Choice

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“…Specifically, local EPBs suffered from more serious internal management problems and risk-averse problems (i.e., being afraid to upset local regulated actors) [28]. The weaker the legal institutions were, the more serious local environmental law enforcement was undermined, so that previously the tax compliance was relatively low with low-quality legal institutions [29].…”

Section: The Effect Of Regional Legal Qualitymentioning

confidence: 99%

Valuation Impacts of Environmental Protection Taxes and Regulatory Costs in Heavy-Polluting Industries

Yue

Liu

et al. 2020

IJERPH

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In 2016, the issue of the Environmental Protection Tax Law indicated the enhancement of environmental protection in China. This study examines the market reaction to firms in heavy-polluting industries, and the effects of external legal institutional quality and internal environmental disclosure on firm value around the passage of Environmental Protection Tax Law. Using an event study approach coupled with ordinary least square regressions, the researchers find a significantly negative market reaction to firms in heavy-polluting industries, but this negative reaction varies depending on the expected increase in future regulatory costs. Specifically, the above negative reaction is stronger when the firm reveals that itself or its subsidiary belongs to heavy-polluting industry, however it would be mitigated when a firm is in a region with better quality of legal institutions or discloses environmental improvement activities. Overall, the results are consistent with the market perceiving that the environmental protection tax law enacted would increase regulatory costs for firms in heavy-polluting industries, and also show the higher-quality regional legal institutions and more efforts on environmental protection could relieve the market’s pessimism caused by uncertainty.

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The Impact of Corruption on Firm Tax Compliance in Transition Economies: Whom Do You Trust?

Cited by 86 publications

References 67 publications

To Pay or Not to Pay? Business Owners’ Tax Morale: Testing a Neo-Institutional Framework in a Transition Environment

To Pay or Not to Pay? Business Owners’ Tax Morale: Testing a Neo-Institutional Framework in a Transition Environment

Tax structure and corruption: cross-country evidence

Valuation Impacts of Environmental Protection Taxes and Regulatory Costs in Heavy-Polluting Industries

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