IDEAS home Printed from https://ideas.repec.org/p/unu/wpaper/wp-2025-64.html

Tax code complexity, tax advisor services and firm outcomes: Evidence from South Africa

Author

Listed:
  • Nadine Riedel
  • Franziska Sicking
  • Ida Zinke

Abstract

We study the impact of tax preparers on corporate tax optimization in South Africa. The analysis draws on the population of corporate income tax returns linked to data on tax preparer use. Consistent with tax code complexity and frictions in the take-up of tax advantages, we document that firms' reported taxable income and tax payments decline significantly when they start utilizing tax preparer services.

Suggested Citation

  • Nadine Riedel & Franziska Sicking & Ida Zinke, 2025. "Tax code complexity, tax advisor services and firm outcomes: Evidence from South Africa," WIDER Working Paper Series wp-2025-64, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2025-64
    as

    Download full text from publisher

    File URL: https://www.wider.unu.edu/sites/default/files/Publications/Working-paper/PDF/wp2025-64-tax-code-complexity-tax-advisor-services-and-firm-outcomes.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hauck, Tobias & Wallossek, Luisa, 2024. "Optional (non-)filing and effective taxation," Journal of Public Economics, Elsevier, vol. 238(C).
    2. Guyton, John L. & O'Hare, John F. & Stavrianos, Michael P. & Toder, Eric J., 2003. "Estimating the Compliance Cost of the U.S. Individual Income Tax," National Tax Journal, National Tax Association;National Tax Journal, vol. 56(3), pages 673-688, September.
    3. Eric Zwick, 2021. "The Costs of Corporate Tax Complexity," American Economic Journal: Economic Policy, American Economic Association, vol. 13(2), pages 467-500, May.
    4. Joel Slemrod & Jon Bakija, 2008. "Taxing Ourselves, 4th Edition: A Citizen's Guide to the Debate over Taxes," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262693631, December.
    5. Wier, Ludvig, 2020. "Tax-motivated transfer mispricing in South Africa: Direct evidence using transaction data," Journal of Public Economics, Elsevier, vol. 184(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:ces:ceswps:_10462 is not listed on IDEAS
    2. Youssef Benzarti, 2020. "How Taxing Is Tax Filing? Using Revealed Preferences to Estimate Compliance Costs," American Economic Journal: Economic Policy, American Economic Association, vol. 12(4), pages 38-57, November.
    3. Youssef Benzarti, 2021. "Estimating the Costs of Filing Tax Returns and the Potential Savings from Policies Aimed at Reducing These Costs," Tax Policy and the Economy, University of Chicago Press, vol. 35(1), pages 55-85.
    4. Giulia Aliprandi & Alice Chiocchetti & Manon Francois & Laure Heidmann, 2025. "Shift or Share? Anatomy of Profit Shifting and Distributional Effects on Workers," CESifo Working Paper Series 12202, CESifo.
    5. Laurence J. Kotlikoff & Kent Smetters & Jan Walliser, 1999. "Privatizing Social Security in the U.S. -- Comparing the Options," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 2(3), pages 532-574, July.
    6. Nivala, Annika, 2024. "(No) Effects of Subsidizing the First Employee: Evidence of a Low Take-up Puzzle Among Firms," Working Papers 166, VATT Institute for Economic Research.
    7. Joseph G. Haubrich, 2020. "A Brief History of Bank Capital Requirements in the United States," Economic Commentary, Federal Reserve Bank of Cleveland, vol. 2020(05), pages 1-6, February.
    8. Gale, William G., 1997. "What Can America Learn From the British Tax System?," National Tax Journal, National Tax Association;National Tax Journal, vol. 50(4), pages 753-777, December.
    9. Bepi Tattara, 2023. "Ill capitalismo in africa: lotta per le risorse e i mercati," ECONOMIA E SOCIET? REGIONALE, FrancoAngeli Editore, vol. 2023(2), pages 115-127.
    10. Alex Rees-Jones & Dmitry Taubinsky, 2018. "Taxing Humans: Pitfalls of the Mechanism Design Approach and Potential Resolutions," Tax Policy and the Economy, University of Chicago Press, vol. 32(1), pages 107-133.
    11. Bilicka, Katarzyna & Scur, Daniela, 2024. "Organizational capacity and profit shifting," Journal of Public Economics, Elsevier, vol. 238(C).
    12. Jeffrey L. Coles & Elena Patel & Nathan Seegert & Matthew Smith, 2022. "How Do Firms Respond to Corporate Taxes?," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 60(3), pages 965-1006, June.
    13. Makoto Hasegawa & Takafumi Kawakubo & Takafumi Suzuki & Masayoshi Hayashi, 2026. "Tax-Motivated Transfer Pricing and Country-by-Country Reporting: Evidence from Japanese Customs Data," CIRJE F-Series CIRJE-F-1266, CIRJE, Faculty of Economics, University of Tokyo.
    14. Abe,Kenzo & Hayakawa,Kazunobu & Yang,Chih-hai, 2026. "Complying with Rules of Origin and Transfer Pricing," IDE Discussion Papers 989, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    15. Andrea Morone & Francesco Nemore & Simone Nuzzo, 2018. "Experimental evidence on tax salience and tax incidence," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 20(4), pages 582-612, August.
    16. Granja, João & Makridis, Christos & Yannelis, Constantine & Zwick, Eric, 2022. "Did the paycheck protection program hit the target?," Journal of Financial Economics, Elsevier, vol. 145(3), pages 725-761.
    17. Selale Tuzel & Miao Ben Zhang, 2021. "Economic Stimulus at the Expense of Routine‐Task Jobs," Journal of Finance, American Finance Association, vol. 76(6), pages 3347-3399, December.
    18. Athreya, Kartik B., 2014. "Big Ideas in Macroeconomics: A Nontechnical View," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262019736, December.
    19. Kotval-K, Zeenat & Vojnovic, Igor, 2016. "A socio-ecological exploration into urban form: The environmental costs of travel," Ecological Economics, Elsevier, vol. 128(C), pages 87-98.
    20. Konda, Laura & Patel, Elena & Seegert, Nathan, 2022. "Tax enforcement and the intended and unintended consequences of information disclosure," Journal of Public Economics, Elsevier, vol. 212(C).
    21. Garcia Huitron, Manuel & Ponds, Eduard, 2016. "Participation and Choice in Funded Pension Plans : Guidance for the Netherlands from Worldwide Diversity," Other publications TiSEM 5351a381-f866-4566-82d8-9, Tilburg University, School of Economics and Management.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:unu:wpaper:wp-2025-64. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Siméon Rapin (email available below). General contact details of provider: https://edirc.repec.org/data/widerfi.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.