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Causes and Consequences of Tax Morale: An Empirical Investigation

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  • Torgler, Benno

    (School of Economics and Finance, Faculty of Business, Queensland University of Technology and CREMA – Center for Research in Economics)

  • Demir, Ihsan C.

    (Department of Public Finance, Afyon Kocatepe University, Afyon, Turkey)

  • Macintyre, Alison

    (School of Economics and Finance, Faculty of Business, Queensland University of Technology)

  • Schaffner, Markus

    (School of Economics and Finance, Faculty of Business Queensland University of Technology)

Abstract

Many taxpayers truthfully declare their income to the tax administration. Why is this the case given that there is a relatively low likelihood of being audited? One answer could be found in tax morale of the citizens. Using micro data sets from the USA and Turkey, we find a significant correlation between tax morale and tax evasion after controlling for a variety of factors. Furthermore, we analyse tax morale as a dependent variable and study the determinants that shape it. The results indicate that factors such as the tax administration, tax system and the perceived tax burden, tax awareness, compliance perceptions, trust in officials, the state and others, institutional quality such as corruption, the willingness to obey and religiosity have a relatively strong impact on tax morale.

Suggested Citation

  • Torgler, Benno & Demir, Ihsan C. & Macintyre, Alison & Schaffner, Markus, 2008. "Causes and Consequences of Tax Morale: An Empirical Investigation," Economic Analysis and Policy, Elsevier, vol. 38(2), pages 313-339, September.
    • Handle: RePEc:eee:ecanpo:v:38:y:2008:i:2:p:313-339
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    More about this item

    Keywords

    tax morale; tax compliance; tax evasion; tax system; tax administration; institutional quality; social capital; corruption; procedural fairness; obedience; tax burden;
    All these keywords.

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

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