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Tax Morale

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  • Erzo F.P. Luttmer
  • Monica Singhal

Abstract

Standard economic models of tax compliance have focused on enforcement-driven compliance. Notably, tax administrators also tend to place a great deal of emphasis on the importance of improving "tax morale" by encouraging voluntary compliance, creating a culture of compliance, and changing social norms. Tax morale does indeed appear to be an important component of compliance decisions, and there is strong evidence that tax morale operates through a variety of underlying channels. There is less evidence - to date - that indicates we know how to leverage these channels to improve compliance and revenue collection in a consistently successful way.

Suggested Citation

  • Erzo F.P. Luttmer & Monica Singhal, 2014. "Tax Morale," NBER Working Papers 20458, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:20458
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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