Trust and power as determinants of tax compliance across 44 nations

Larissa Batrancea, Anca Nichita, Jerome Olsen, Christoph Kogler, Erich Kirchler, Erik Hoelzl, Avi Weiss, Benno Torgler, Jonas Fooken, Joanne Fuller, Markus Schaffner, Sheheryar Banuri, Medhat Hassanein, Gloria Alarcón-García, Ceyhan Aldemir, Oana Apostol, Diana Bank Weinberg, Ioan Batrancea, Alexis Belianin (), Felipe de Jesús Bello Gómez, Marie Briguglio, Valerij Dermol, Elaine Doyle, Rebone Gcabo, Binglin Gong, Sara Ennya, Anthony Essel-Anderson, Jane Frecknall-Hughes, Ali Hasanain, Yoichi Hizen, Odilo Huber, Georgia Kaplanoglou, Janusz Kudła, Jérémy E. Lemoine, Supanika Leurcharusmee, Þórólfur Matthíasson (), Sanjeev Mehta, Sejin Min, George Naufal, Mervi Niskanen, Katarina Nordblom, Bilal Bagis, Luis Pacheco, József Pántya, Vassilis Rapanos, Christine Roland-Lévy, Ana Maria Roux-Cesar, Aidin Salamzadeh (), Lucia Savadori, Vidar Schei, Manoj Sharma, Barbara Summers, Komsan Suriya, Quoc Tran, Clara Villegas-Palacio, Martine Visser, Chun Xia, Sunghwan Yi and Sarunas Zukauskas

Journal of Economic Psychology, 2019, vol. 74, issue C

Abstract: The slippery slope framework of tax compliance emphasizes the importance of trust in authorities as a substantial determinant of tax compliance alongside traditional enforcement tools like audits and fines. Using data from an experimental scenario study in 44 nations from five continents (N = 14,509), we find that trust in authorities and power of authorities, as defined in the slippery slope framework, increase tax compliance intentions and mitigate intended tax evasion across societies that differ in economic, sociodemographic, political, and cultural backgrounds. We also show that trust and power foster compliance through different channels: trusted authorities (those perceived as benevolent and enhancing the common good) register the highest voluntary compliance, while powerful authorities (those perceived as effectively controlling evasion) register the highest enforced compliance. In contrast to some previous studies, the results suggest that trust and power are not fully complementary, as indicated by a negative interaction effect. Despite some between-country variations, trust and power are identified as important determinants of tax compliance across all nations. These findings have clear implications for authorities across the globe that need to choose best practices for tax collection.

Keywords: Trust; Power; Slippery slope framework; Tax compliance; Tax evasion (search for similar items in EconPapers)
JEL-codes: H10 H20 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (40)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:joepsy:v:74:y:2019:i:c:s0167487019301746

DOI: 10.1016/j.joep.2019.102191

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