Tax Complexity and Corruption

Yaron Zelekha

Applied Economics Quarterly (formerly: Konjunkturpolitik), 2017, vol. 63, issue 2, 177-210

Abstract: Complicated tax systems may provide more opportunities for rent-seeking tax officials and politicians to grant favors and may attract the activity of fixers, both of which may lead to corruption. However, the possible channels between tax complexity and corruption have not been addressed in the literature. Using a large cross-section sample dataset, this study presents the empirical evidence suggesting that high degrees of tax complexity may serve as a breeding ground for corruption. Furthermore, in this framework, I examine the conditions under which the impact of tax complexity can change. Moreover, this study helps to resolve whether tax complexity effects are derived from tax levels, tax system structure or pure complexity.

Keywords: Tax; Corruption; Complexity; Institutions (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (3)

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Applied Economics Quarterly (formerly: Konjunkturpolitik) is currently edited by Cinzia Alcidi, Christian Dreger and Daniel Gros

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