Tax Compliance and Firms' Strategic Interdependence

Ralph-C Bayer (ralph.bayer@adelaide.edu.au) and Frank Cowell (f.cowell@lse.ac.uk)

No 2006-09, School of Economics and Public Policy Working Papers from University of Adelaide, School of Economics and Public Policy

Abstract: We focus on a relatively neglected area of the tax-compliance literature in economics, the behaviour of firms. We examine the impact of alternative audit rules on receipts from a tax on profits in the context of strategic interdependence of firms. In the market firms may compete in terms of either output or price. The enforcement policy can have an effect on firms' behaviour in two dimensions - their market decisions as well as their compliance behaviour. An appropriate design of the enforcement policy can thus have a "double dividend" by manipulating firms in both dimensions.

Keywords: tax compliance; evasion; oligopoly (search for similar items in EconPapers)
JEL-codes: H20 H21 (search for similar items in EconPapers)
Date: 2006
New Economics Papers: this item is included in nep-acc, nep-mic and nep-pbe
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Citations: View citations in EconPapers (13)

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Related works:
Journal Article: Tax compliance and firms' strategic interdependence (2009)
Working Paper: Tax Compliance and Firms’ StrategicInterdependence (2006)
Working Paper: Tax compliance and firms' strategic interdependence (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:adl:wpaper:2006-09

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