Peers, Morality, and Taxation: An Analysis of the Influence of Peers Groups on Income Tax Compliance.

Abstract

As judged by the size of the gap between the income taxes that should be paid and those that are paid, tax compliance will continue to be an important topic for the accounting literature. Although many believe that peer groups can influence the intention to pay taxes, the effect has been inadequately demonstrated. Using data created by an experimental tax task, this study shows a pervasive peer group influence. This result is not limited to family members, not stronger for different income types, and not compromised by taxpayer belief in the morality of tax paying. Implications for research and practice are offered.