Why People Evade Taxes in the Czech and Slovak Republics: A Tale of Twins
AbstractThe present paper uses a survey of 1062 Czechs and 524 Slovaks to ask why people evade taxes. We maintain that the Czech and Slovak Republics are “twins” separated at birth and that divergences between these countries since their separation in 1992 can explain divergences in their rates of tax evasion. High Slovak tax rates and lower Czech tax rates seem to explain little of the difference in evasion between the two countries. Rising Czech incomes seems the main reason that Czech Republic evades more taxes. We also look at detailed demographic and psychological reasons for tax evasion. We find that morality is a strong deterrent to evasion.
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Bibliographic InfoPaper provided by EconWPA in its series Public Economics with number 0205003.
Date of creation: 09 May 2002
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Tax evasion; transition economies; Czech Republic; Slovak Republic;
Find related papers by JEL classification:
- H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion
- H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate
- K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
- O17 - Economic Development, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-06-13 (All new papers)
- NEP-LAW-2002-06-13 (Law & Economics)
- NEP-PBE-2002-06-13 (Public Economics)
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