Tax Auditing as a Public Good Game: An Experimental Study on Punishment and Compliance

Hsu, Li-Chen

doi:10.1111/1468-0106.12034

Cited by 5 publications

(3 citation statements)

References 41 publications

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“…Several findings in the tax compliance field have offered a similar result (Hsu & Kan, 2020;Rahmayanti et al, 2020;Oladele et al, 2019). However, it contradicts the findings of Bangun et al (2018) and Lavic (2023).…”

Section: Discussionmentioning

confidence: 81%

“…The effects of tax penalty on tax compliance have been widely examined (Nguyen et al, 2020;Rahmayanti et al, 2020;Widuri et al, 2019). Several studies have revealed that tax penalty is significantly related to taxpayers' compliance (Hsu & Kan, 2020;Rahmayanti et al, 2020;Widuri et al, 2019), while other studies have found no significant relationship (Bangun et al, 2018;Mahdi & Ardiati, 2017). However, this plethora of findings has mainly focused on taxpayers' general compliance and evasion.…”

Section: Tax Penaltymentioning

confidence: 99%

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The Effect of Tax Penalty, Probability of Audit and Fair Treatment on Permanent Voluntary Disclosure: Tax Professionals’ Perspective

Sikayu,

Baihaki,

Kamaluddin

2024

IJBT

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This paper examines the effects of tax penalty, the probability of audit and fair treatment to participate in permanent voluntary disclosure (VD), from the perspective of tax professionals. A total of 2,540 questionnaires were distributed to tax professionals in Malaysia using a combination of online and drop-off modes. The potential respondents were selected using a simple random sampling technique. The collected dataset comprised 192 useable questionnaires. To unravel the underlying factors influencing permanent VD, the research employed Smart PLS Version 4.0.9.6 for data analysis. The results revealed that tax penalty and the likelihood of probability of audit are significant in influencing corporate taxpayers’ motivation to partake in permanent VD. Surprisingly, the element of fair treatment towards taxpayers is not significant. In addition, the findings reveal that tax penalty, the probability of audit, and fairness treatment, explain 0.195 of variance (R2) in corporate taxpayers’ motivation towards partaking in permanent VD. The current findings may facilitate policymakers and the tax revenue authority in devising strategies to enhance the attractiveness of permanent VD. An enhanced permanent VD will benefit the tax revenue authority as it saves time and cost of collecting information on tax audits and investigation cases. Our findings contribute to the paucity of published work pertaining to the use of threat and fairness in galvanising participation in permanent VD.

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Section: Discussionmentioning

confidence: 81%

Section: Tax Penaltymentioning

confidence: 99%

The Effect of Tax Penalty, Probability of Audit and Fair Treatment on Permanent Voluntary Disclosure: Tax Professionals’ Perspective

Sikayu,

Baihaki,

Kamaluddin

2024

IJBT

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“…In an experimental study by Hsu (2013), it was found that on average, subjects are willing to spend 20% to 30% of their tax revenue on auditing. Compliance is also improved if subjects can determine the budget and the probability of audit.…”

Section: Tax Audit Outcomementioning

confidence: 99%

An analysis of taxpayer compliance using a cost-benefit approach

Tin¹

2019

JABES

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40 years of tax evasion games: a meta-analysis

Alm

Malézieux

2020

Exp Econ

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We collect individual participant data from 70 papers that use laboratory experiments to examine individual tax evasion behavior (or "Tax Evasion Games"), in order to use meta-analysis to estimate the impacts of different public policy, experimental design and individual level variables on tax evasion choices. Our results show that standard enforcement variables like audits (including audit rules) and fines perform differently on the extensive and intensive margins. We find that other fiscal variables like a flat tax system, tax rates, and tax amnesties have unambiguous negative impacts on tax compliance, and that specific features of the experimental setting, such as how subjects are directed to report income, or whether taxes are redistributed to the participants or to a real life public good, have significant impacts on tax compliance. Our results also indicate that the demographic characteristics of the subjects (e.g., gender, experimental income, occupation, risk attitude) affect compliance.

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Tax Auditing as a Public Good Game: An Experimental Study on Punishment and Compliance

Cited by 5 publications

References 41 publications

The Effect of Tax Penalty, Probability of Audit and Fair Treatment on Permanent Voluntary Disclosure: Tax Professionals’ Perspective

The Effect of Tax Penalty, Probability of Audit and Fair Treatment on Permanent Voluntary Disclosure: Tax Professionals’ Perspective

An analysis of taxpayer compliance using a cost-benefit approach

40 years of tax evasion games: a meta-analysis

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