Universität zu Köln

Kölle, Tobias Julian (2020). Enhancing Tax Compliance of Individuals: Effective Audit Systems and Anti-Tax-Evasion Mechanisms. PhD thesis, Universität zu Köln.

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Abstract

This thesis expands the understanding of tax compliance of individuals. The three essays provide novel insights that might be especially relevant for governments combating tax evasion. The first essay studies the design of effective audit systems to promote compliance. In particular, it analyzes the effects of (1) increasing the detection probability of non-compliance, (2) monetary incentives to promote compliance (bonuses and penalties), and the interaction of (1) and (2). In conclusion, compliance decreases with audit systems that penalize non-compliance (or reward compliance) with a low detection probability compared to a situation without any audits. Only a penalty system with a high detection probability ensures higher compliance than without audits. The second essay analyzes three mechanisms that might affect tax compliance: 1) prefilling of deductions in tax returns, 2) restricting tax evasion opportunities by either disallowing or 3) limiting the deductibility of expenditures. In conclusion, prefilling reduces tax evasion compared to blank forms. Contrary, cutting the number of tax evasion opportunities by disallowing the deductibility of expenditure items is ineffective. In fact, individuals shift their tax evasion activities from the disallowed item to non-restricted items. However, this evasion-shift-effect seems to be avoidable by just limiting the deductibility of expenditures. The third essay reviews the non-monetary costs of tax evasion. Backed up with a theoretical framework of non-monetary costs of tax evasion, the chapter emphasizes the importance of non-monetary costs of tax evasion. In particular, it explains the influence of social norm, trust, fairness, participation rights, complexity and knowledge, patriotism, and moral emotions on tax compliance behavior.

Item Type:	Thesis (PhD thesis)
Creators:	Creators Email ORCID ORCID Put Code Kölle, Tobias Julian tobias.koelle@gmx.de UNSPECIFIED UNSPECIFIED
URN:	urn:nbn:de:hbz:38-300784
Date:	18 December 2020
Language:	English
Faculty:	Faculty of Management, Economy and Social Sciences
Divisions:	Faculty of Management, Economics and Social Sciences > Business Administration > Accounting and Taxation > Professorship for Business Administration and Business Taxation
Subjects:	Social sciences Management and auxiliary services
Uncontrolled Keywords:	Keywords Language Tax Compliance Individuals Audit Systems Prefilling Monetary Non-monetary costs Experimental Laboratory English
Date of oral exam:	18 December 2020
Referee:	Name Academic Title Overesch, Michael Prof. Dr. Fochmann, Martin Prof. Dr.
Refereed:	Yes
URI:	http://kups.ub.uni-koeln.de/id/eprint/30078