Governance quality and tax morale and compliance in Zimbabwe’s informal sector

Mpofu, Favourate Y.

doi:10.1080/23311975.2020.1794662

Cited by 55 publications

(33 citation statements)

References 43 publications

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“…The behavioural components of the behavioural economics theory assume that individuals have their differing opinion about tax compliance according to their attitudes, culture, peer influence, beliefs, values, ethics, demographic characteristics, norms and roles (Elffers et al, 1992;Lewis, 1982;Oana, 2018;Sebele-Mpofu, 2020;Warneryd & Walerud, 1982). The behavioural aspect of the model considers what Weber et al (2014) called social effects, which are influenced by the sociocultural environment of a taxpayer.…”

Section: Theoretical Literature Reviewmentioning

confidence: 99%

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Assessing SMEs tax non-compliance behaviour in Sub-Saharan Africa (SSA): An insight from Nigeria

Vincent

2021

Cogent Business & Management

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The existing studies on determinants of small and medium enterprises (SMEs) tax compliance behaviour in Sub-Saharan Africa have been criticised on account of limited study scope which compromises generalisation and poor theorisation that have little or no support for the research questions of such studies. The current study is rooted in behavioural economics theory and elicits information from 392 participants from all geopolitical zones of Nigeria using paper-and-pencil survey instruments. The study's findings reveal that tax system complexity, tax deterrence sanction, tax noncompliance opportunity, tax information and tax attitude and perception are important determinants of tax compliance behaviour, while tax rate and tax compliance cost may not necessarily exert significant influence. The overall conclusion from the study reveals that certain economic and behavioural factors are effective in either encouraging or discouraging tax compliance behaviour. The study also reveals tax information to be one of the most significant drivers of tax compliance; however, little or nothing is known of this construct in the existing literature. The theoretical and policy implications of the study are discussed and suggestions for future studies are offered.

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Section: Theoretical Literature Reviewmentioning

confidence: 99%

“…The perception of equity or fairness strongly correlates with tax compliance behaviour (Jackson & Milliron, 1986;Sebele-Mpofu, 2020). Spicer and Lundstedt (1976) established a negative correlation between fairness and tax evasion.…”

Section: H 3 : Increase In Tax Compliance Costs Increases the Likelihood Of Tax Non-compliance Behaviour Of Smesmentioning

confidence: 99%

Assessing SMEs tax non-compliance behaviour in Sub-Saharan Africa (SSA): An insight from Nigeria

Vincent

2021

Cogent Business & Management

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“…Literature has corroborated that a higher level of governance and a lower level of corruption may improve the tax revenue collection [11][12][13][14][15][16][17]. On the other hand, Mallick [18] corroborated an insignificant relationship between governance and tax collection.…”

Section: Introductionmentioning

confidence: 98%

Governance: A Source to Increase Tax Revenue in Pakistan

et al. 2021

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Improved governance in any economy indicates government stability, secured law and order, and minimum internal and external conflicts. A higher level of governance may demonstrate the healthy performance of economic activities and tax revenue collection. Hence, it is vital to investigate the relationship between governance and tax revenue collection in any developing country. Therefore, we aim to investigate the impact of governance on tax revenue in Pakistan using control variables inflation and industrial value-added. The Autoregressive Distributive Lag (ARDL) cointegration technique is utilized to find the long- and short-run effects of hypothesized variables on the tax revenue using a period 1976–2019. After employing a cointegration on the hypothesized model, the results expose that government stability, law and order, and internal and external conflicts leave a positive and significant impact on tax revenue in the long and short run. Hence, it is concluded that governance is an essential source in expanding tax revenue in Pakistan. Moreover, industrial value-added and inflation also show positive effects on the tax revenue. On the grounds of these results, it is proposed that the government should make serious efforts to improve governance and industrial activities for better tax revenue collection.

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“…Source: Own Compilation the policy makers (Ministry of Finance) on the other hand take rational choices on how to curb TP tax avoidance and evasion strategies that lead to BEPS through tax administration (coercive and synergistic strategies as highlighted by Kirchler et al (2008)) and through tax policy crafting respectively. The decisions are influenced by the costs (administration and implementation), rewards (incentives and exemptions and their impact to the economy) and punishments (penalties) (Scott, 2000). So in arriving at the decisions all the three stakeholders, just like rational economic actors, prioritise their own agendas and interests ahead of others, MNEs (as taxpayers) and ZIMRA and MOF (as regulators).…”

Section: Figure 1 Conceptual Framework Rational Actors Actions and Decisions (Rationality And Exploitative Rationality)mentioning

confidence: 99%

An exposition of transfer pricing motives, strategies and their implementation in tax avoidance by MNEs in developing countries

Mpofu

Mashiri²,

Schwartz

2021

Cogent Business & Management

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The abuse of transfer pricing by multinational enterprises (MNEs) is a topical issue the world over. Abusive transfer pricing results in the erosion of tax bases and profit shifting from countries with high tax rates to those with lower tax rates, thus enabling tax avoidance and evasion. Developing countries are argued to suffer most under the negative impacts of transfer pricing manipulation. This study investigates the strategies employed by MNEs to minimise their tax burden in developing countries. An understanding of the motives and strategies is fundamental in tax policy crafting and improvements that effectively respond to transfer pricing. Adopting the interpretivist research philosophy with the use of in-depth interviews with tax officers, tax consultants and Ministry of Finance Officials, the study established that amongst the transfer pricing schemes used by MNEs in Zimbabwe, the predominant one was the use of service fees. The most notable being management fees, this was a contribution to knowledge as this strategy was found to be scarcely discussed in literature and there was very little empirical evidence to back its existence. The study recommended use of targeted approaches by the revenue authority to minimise revenue losses through intragroup services.The findings serve as vital information for policymakers, revenue authorities and tax auditors.

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Governance quality and tax morale and compliance in Zimbabwe’s informal sector

Cited by 55 publications

References 43 publications

Assessing SMEs tax non-compliance behaviour in Sub-Saharan Africa (SSA): An insight from Nigeria

Assessing SMEs tax non-compliance behaviour in Sub-Saharan Africa (SSA): An insight from Nigeria

Governance: A Source to Increase Tax Revenue in Pakistan

An exposition of transfer pricing motives, strategies and their implementation in tax avoidance by MNEs in developing countries

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