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Support for Economic Inequality and Tax Evasion

Author

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  • William E. Shafer

    (Department of Accountancy, Lingnan University, Tuen Mun, New Territories, Hong Kong)

  • Zhihong Wang

    (Graduate School of Management, Clark University, Worcester, MA 01610, USA)

  • Tien-Shih Hsieh

    (Charlton College of Business, University of Massachusetts Dartmouth, North Dartmouth, MA 02747, USA)

Abstract

The primary focus of this paper is on the relationship between taxpayers’ ideological support for economic inequality and the likelihood they will commit tax evasion. We also propose that Machiavellianism will mediate the relationship between support for inequality and tax evasion. The results, based on a survey of experienced taxpayers, partially support our expectations. Ideological support for economic inequality had a significant positive association with Machiavellianism, which in turn had a strong positive association with tax evasion intentions. Machiavellianism fully mediated the relationship between support for inequality and tax evasion. This is the first study to investigate the potential influence of support for economic inequality on taxpayers’ evasion decisions. In light of the findings, we suggest that support for the persistence of economic inequality and related ideological beliefs may pose fundamental threats to governments’ ability to sustain just and fair socioeconomic systems. We also argue that such ideologies are likely to be associated with the ethical decisions of corporate managers, business owners and professionals across a variety of decision contexts, but their influence has largely been ignored in the business and society and sustainability literature.

Suggested Citation

  • William E. Shafer & Zhihong Wang & Tien-Shih Hsieh, 2020. "Support for Economic Inequality and Tax Evasion," Sustainability, MDPI, vol. 12(19), pages 1-18, September.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:19:p:8025-:d:421090
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    References listed on IDEAS

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    2. Masca, Simona-Gabriela & Chis, Diana-Maria, 2023. "Distributional implications of informal economy in the EU countries: Accounting for the spread of tax evasion benefits and cultural characteristics," Socio-Economic Planning Sciences, Elsevier, vol. 87(PB).

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