Deterrence and Morale in Taxation: An Empirical Analysis
AbstractThe standard model of tax evasion based on the subjective expected utility maximization does not perform particularly well in econometric analyses: it predicts too little evasion and produces unsatisfactory econometric parameter estimates. The model is extended by looking at how the tax authority deals with the taxpayers. Based on econometric estimates, it is shown that taxpayers’ tax morale is raised when the tax officials treat them with respect. In contrast, when tax officials solely rely on deterrence taxpayers tend to respond by actively trying to avoid taxation.
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Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 760.
Date of creation: 2002
Date of revision:
Find related papers by JEL classification:
- D60 - Microeconomics - - Welfare Economics - - - General
- H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
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