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Tax Morale, Slippery-Slope Framework and Tax Compliance: A Cross-section Analysis

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  • Gabriele Ruiu

    (University of Cassino)

  • Gaetano Lisi

    (University of Cassino)

Abstract

Following two important strands of tax compliance literature, this empirical paper develops a cross-section analysis in order to test both the role of tax morale on tax compliance decisions and the main predictions of the slippery slope framework. Using data from the World Value Surveys (WWS), we find empirical support for the slippery slope framework, since trust in and power of tax authorities are negatively and significantly related to a proxy for tax non-compliance behavior given by the size of the hidden economy. In particular, trust in tax authorities exerts a larger effect on shadow economy than the power of tax authorities. Instead, the relation between tax morale and our proxy for tax evasion is not statistically significant.

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Bibliographic Info

Paper provided by Universita' di Cassino, Dipartimento di Scienze Economiche in its series Working Papers with number 2011-05.

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Length: 35 pages
Date of creation: 18 Jul 2011
Date of revision:
Handle: RePEc:css:wpaper:2011-05

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