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Laboratory Study on the Effect of Ethical Framework
and Disclosure on Tax Compliance
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Fariba Esmaili   , Monireh Rafat * |
| Department of Economics, University of Isfahan , M.rafat@ase.ui.ac.ir |
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Abstract: (13 Views) |
| Tax compliance in economic literature is considered the most fundamental goal for an efficient tax system, which refers to the taxpayers' adherence to tax obligations and compliance with tax laws. Optimal provision of public goods and improvement of income distribution require consideration of tax compliance. Increasing the level of tax compliance causes an increase in government tax revenues, which is why governments seek to increase the degree of tax compliance. This study aimed to investigate the effects of ethical frameworks and disclosure on tax compliance, using experimental economics and the public goods game. The results show that out of the total 40 points of the public goods game, ethical shame with an average of 87/34 participation in the individual game stage, ethical framework with an average of 47/33 group participation in rounds 2 to 8, and again ethical framework with an average of 83/33 group participation in the final two rounds of the game lead to greater tax compliance. However, examining the effect of disclosure on tax compliance shows that disclosure leads to tax compliance when others also follow the rules, but in a situation where everyone attempts to evade or avoid taxes, there is no longer any sense of shame caused by disclosure, because in this case, tax non-compliance will not be considered undesirable behavior. |
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| Keywords: Tax compliance, Ethical framework, Laboratory economics |
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Full-Text [PDF 751 kb]
(5 Downloads)
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Type of Study: Applicable |
Subject:
Special
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