Taxation determinants of fiscal corruption: evidence across countries

Purpose - The purpose of the study is to investigate the extent to which taxation variables explain differences in fiscal corruption (FISC) across countries. Design/methodology/approach - The study employs an empirical research design, utilizing cross‐country data for all of the relevant variables of interest. The hypotheses of the study are tested using both univariate and multivariate statistical testing approaches. Findings - Based on a sample of 48 countries, and after controlling for economic development (bureaucratic compensation), size of government and democracy, the regression results indicate that the lower the level of tax evasion (TEVA) and tax law complexity (TLAWC), and the higher the level of self‐assessment, the lower is the level of FISC in a country. These regression results remain quite robust after considering many different regression model specifications. Research limitations/limitation - The study has several limitations, including a relatively small country sample size and potential measurement error for several of the variables. Practical implications - The results of the study could lead to more effective country tax administrations, particularly in terms of tax revenue collection. Originality/value - This represents one of the first empirical studies to systematically investigate the extent to which taxation variables explain differences in FISC across countries, hence it fills a major gap in the literature about FISC internationally.