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Voluntary versus enforced tax compliance: the slippery slope framework in the Brazilian context

Author

Listed:
  • Fábio Pereira Silva

    (University of São Paulo)

  • Reinaldo Guerreiro

    (University of São Paulo)

  • Eduardo Flores

    (University of São Paulo)

Abstract

Research on tax compliance was initially conducted using the classical economic paradigm. However, several papers have demonstrated that this “crime paradigm” only partially explains taxpayer behavior. In this context, a new pattern emerged, labeled the “service paradigm,” which assumes that taxpayers are not rational individuals only concerned with maximizing usefulness; they should also receive proper treatment and good-quality public services in return for paying taxes. This paper aims to evaluate both paradigms and their influences on the tax collection level and seeks to determine whether they affect enforced and voluntary tax compliance. The theoretical assumptions were verified through empirical assessment using an online experimentation method with Brazilian taxpayers. The results confirm the existence of trust-based interactions between taxpayers and public administration that leads to voluntary compliance, while policies based on the imposition of power result in enforced compliance.

Suggested Citation

  • Fábio Pereira Silva & Reinaldo Guerreiro & Eduardo Flores, 2019. "Voluntary versus enforced tax compliance: the slippery slope framework in the Brazilian context," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 66(2), pages 147-180, June.
    • Handle: RePEc:spr:inrvec:v:66:y:2019:i:2:d:10.1007_s12232-019-00321-0
    DOI: 10.1007/s12232-019-00321-0
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    1. Oluwafadekemi S. Areo & Obindah Gershon & Evans Osabuohien, 2020. "Improved Public Services and Tax Compliance of Small and Medium Scale Enterprises in Nigeria: A Generalised Ordered Logistic Regression," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 10(7), pages 833-860, July.
    2. Santi Novita & Mienati Somya Lasmana & Nor Azrina Mohd Yusof & Roshidah Safeei & Lee Chai Chuen, 2024. "Trust in Government and Tax Compliance in Indonesia and Malaysia: Do Ethics and Tax Amnesty Matter?," International Journal of Economics and Financial Issues, Econjournals, vol. 14(6), pages 10-22, October.

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    More about this item

    Keywords

    Tax evasion; Tax compliance; Slippery slope framework; Crime paradigm; Service paradigm; Brazilian taxpayers;
    All these keywords.

    JEL classification:

    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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