The backfiring effect of auditing on tax compliance
- Author(s)
- Jorge Mendoza, J. L. Wielhouwer, Erico Kirchler
- Abstract
Using country-level data from 2003–2014, we examine the association between auditing level (measured as number of verification actions taken by tax authorities per 100 taxpayers in each country) and tax compliance (measured as business executives’ perception of tax evasion). Our hypothesis is that compliance increases until a certain auditing level is reached, and decreases beyond that level (i.e., an elevated auditing level backfires). In line with our expectation, the results of a series of tests indicate that there is a U-shaped association between auditing and tax evasion. We discuss how a potential backfiring effect may depend on the extent to which compliance is voluntary.
- Organisation(s)
- Department of Occupational, Economic and Social Psychology
- External organisation(s)
- Vrije Universiteit Amsterdam
- Journal
- Journal of Economic Psychology
- Volume
- 62
- Pages
- 284-294
- No. of pages
- 10
- ISSN
- 0167-4870
- DOI
- https://doi.org/10.1016/j.joep.2017.07.007
- Publication date
- 10-2017
- Peer reviewed
- Yes
- Austrian Fields of Science 2012
- 501029 Economic psychology
- Keywords
- ASJC Scopus subject areas
- Economics and Econometrics, Applied Psychology, Sociology and Political Science
- Portal url
- https://ucris.univie.ac.at/portal/en/publications/the-backfiring-effect-of-auditing-on-tax-compliance(125eeb08-af4b-4f63-86a6-9c5db35d0863).html