| Title |
Tax Morale and Tax Payments among Euro Area Households / |
| Authors |
Rutkauskas, Virgilijus |
| ISBN |
9780993519130 |
| Full Text |
|
| Is Part of |
CER Comparative European Research 2016. Proceedings | Research Track of the 6th Biannual CER Comparative European Research Conference.. Sciemcee Publishing, London, 2016. p. 79-82.. ISBN 9780993519130 |
| Keywords [eng] |
tax morale ; tax gap ; public goods ; logit-probit analysis |
| Abstract [eng] |
This paper investigates theoretical and practical aspects of tax morale and tax payments in euro area countries. Taxes are the foremost important income source for modern governments however unwillingness to pay taxes is common phenomenon. This paper provides insights into the ‘tax payment gap’ – the difference between tax actually collected and the tax that should be collected – and argues that it is close to 840 billion euro annually across the euro area. In order to close the tax payment gap, conventional measures like changing the tax rate and taxation base are not very effective and demand for additional measures rises. Households’ tax payment morale is assessed quantitatively by employing a dichotomous logit-probit regression analysis. The research is based on household level data for all euro area countries. The results suggest that the main issues behind weak tax morale are corruption and a lack of national pride. Additionally, tax morale is significantly affected by factors such as age, gender, religiousness, income and education. Given the sensitivity of tax income to changes in tax morale - an increase of the share of households willing to pay taxes by 1 percentage point results in tax income growth by 21 billion per year in all euro area countries - by influencing these attributes, one could anticipate changes in tax morale and tax income for the government. |
| Published |
Sciemcee Publishing, London, 2016 |
| Type |
Conference paper |
| Language |
Lithuanian |
| Publication date |
2016 |
