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Firm-level determinants of business tax evasion in emerging economies: the case of Argentina
[Determinantes microeconómicos de la evasión tributaria empresarial en economías emergentes: el caso de Argentina]

Author

Listed:
  • Pedroni, Florencia Verónica

    (Universidad Nacional del Sur (Argentina))

  • Briozzo, Anahí

    (Universidad Nacional del Sur (Argentina))

  • Pesce, Gabriela

    (Universidad Nacional del Sur (Argentina))

Abstract

This paper aims to identify the determinants of revenue underreporting and their temporal evolution from a business perspective in formal firms located in an emerging country with high inflation (Argentina). We propose a conceptual model and we estimate it empirically using a logistic regression based on pooled data 2010-2017 of the World Bank Enterprise Surveys. The findings show that revenue underreporting is a multicausal phenomenon where taxes lose importance in the light of other determinants such as: corruption, regulation and bureaucracy, quality of public and government services, detection probability, sector informality and political instability. Moreover, the outcomes recognize companies’ characteristics with a greater propensity to underreport sales (smaller size, selling in domestic market, from manufacturing sector, without external financing, with male entrepreneurs). Our empirical evidence is relevant for the formulation of public policies aimed at reducing revenue underreporting.

Suggested Citation

  • Pedroni, Florencia Verónica & Briozzo, Anahí & Pesce, Gabriela, 2022. "Firm-level determinants of business tax evasion in emerging economies: the case of Argentina [Determinantes microeconómicos de la evasión tributaria empresarial en economías emergentes: el caso de ," Revista de Métodos Cuantitativos para la Economía y la Empresa = Journal of Quantitative Methods for Economics and Business Administration, Universidad Pablo de Olavide, Department of Quantitative Methods for Economics and Business Administration, vol. 34(1), pages 83-117, December.
    • Handle: RePEc:pab:rmcpee:v:34:y:2022:i:1:p:83-117
    DOI: https://doi.org/10.46661/revmetodoscuanteconempresa.5277
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    More about this item

    Keywords

    informal sector; revenue underreporting; tax; corruption; bureaucracy; institutional quality; emerging economy; sector informal; subdeclaración de ingresos; impuestos; corrupción; burocracia; calidad institucional; economía emergente;
    All these keywords.

    JEL classification:

    • E26 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm

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