Three Hypotheses About The Corruption And The Taxpayers
There's a significant negative correlation between tax morale and the perceived size of corruption.
An increase in the corruption scale by one unit increases the share of subjects indicating the highest tax morale by more than 1.
7 percentage points.
The corruption variable also remains robust after including the trust variables and the satisfaction with the tax officers and the political system.
Thus, based on these results we can present 3 hypotheses, which cannot be rejected.
If taxpayers notice that many public officials are corrupt and many others evade taxes, they might get the feeling that their intrinsic motivation is not recognized or honored.
Taxpayers get the feeling that they can as well be opportunistic.
Let's see below 3 hypotheses about corruption and taxpayers.
Hypothesis 1: The more extensive the citizens' trust in the government and the legal system, the higher their intrinsic motivation to pay taxes.
Not only trust might be relevant, also satisfaction with the current political process might also have a positive impact on tax morale.
If the political system works well and people are satisfied with the public officers, their intrinsic motivation to pay taxes increases.
Taxpayers are sensitive to the way the government uses the taxes.
There is an input-output relation between what an individual pays with his taxes and what comes back from the government.
Thus, individuals' tax compliance might be influenced by the benefits received from the government in form of public goods compared to the price they paid for them.
Individuals might feel cheated if taxes are not spent adequately.
Thus, taxpayers perceive their relationship with the state not only as a relationship of coercion, but also as one of exchange.
Taxpayers are more inclined to comply with the law if the exchange between the paid tax and the performed government services are found to be equitable.
Hypothesis 2: The more extensive the citizens' satisfaction with public officers and the political system, the higher their intrinsic motivation to pay taxes.
The transformation of the socialist economies into capitalist economies was one of the reasons for such an explosion of corruption, which increased because of the lacking rule of law and accountability of the governance.
Countries with more corruption have a higher share of unofficial economy.
Previous empirical studies have found that corruption is negatively associated with government expenditure on education.
Insecurity of property rights and corruption might also have an impact on tax morale.
Corruption is an integral part of Albania's economy and has the negative consequence that citizens have less trust in the authority.
From previous studies in some transition countries the degree of corruption exceeds the total expenditures on science, education, health care, culture, and art.
In some industrial branches criminal groups spend up to 50% of their revenues to bribe officials.
Corruption generally undermines the tax morale of the citizens, because they get frustrated.
Taxpayers will feel cheated if they believe that corruption is widespread and their tax burden is not spent well.
Corrupt bureaucracy will not award the services to the most efficient producers, but to the producer who offers the larger bribes.
Thus, corruption reduces the efficiency of allocation and produces delays in transactions to acquire additional payments.
Such tendencies might have a strong impact on tax morale.
Hypothesis 3: A higher perceived size of corruption crowds out the public spirit, which reduces tax morale.
A way to combat the corruption would be the creation of a mechanism, where every his part would be a scheme.
Every his part must be in correlation with an expecting message to report vulnerably from taxpayers.
In the time when the law is a joint-venture with the daily routine of officers it is necessary the regulation of strategy of the control for every change of fiscal laws and fiscal tariffs.
This is in correlation with the penalty that must be put in every time for the evaders, which is the more interested to profit from these changes of laws.
The highest authority of tax administration should motivate the tax inspector to be interested in tax bonus, like an "gratuity" that is coming not from tolerance to evaders, but as a higher price for their work done, for the taxes they collect.
Maybe, if the tax inspectors could be more motivated for the work done according to the value of collection of taxes and natural penalty would be optimal in maximalization of tax revenues.
Tis would be helpful to minimize the corruption and to achieve the maximalization of tax revenues, but with tax inspector characterized by the honesty in their job.
An increase in the corruption scale by one unit increases the share of subjects indicating the highest tax morale by more than 1.
7 percentage points.
The corruption variable also remains robust after including the trust variables and the satisfaction with the tax officers and the political system.
Thus, based on these results we can present 3 hypotheses, which cannot be rejected.
If taxpayers notice that many public officials are corrupt and many others evade taxes, they might get the feeling that their intrinsic motivation is not recognized or honored.
Taxpayers get the feeling that they can as well be opportunistic.
Let's see below 3 hypotheses about corruption and taxpayers.
Hypothesis 1: The more extensive the citizens' trust in the government and the legal system, the higher their intrinsic motivation to pay taxes.
Not only trust might be relevant, also satisfaction with the current political process might also have a positive impact on tax morale.
If the political system works well and people are satisfied with the public officers, their intrinsic motivation to pay taxes increases.
Taxpayers are sensitive to the way the government uses the taxes.
There is an input-output relation between what an individual pays with his taxes and what comes back from the government.
Thus, individuals' tax compliance might be influenced by the benefits received from the government in form of public goods compared to the price they paid for them.
Individuals might feel cheated if taxes are not spent adequately.
Thus, taxpayers perceive their relationship with the state not only as a relationship of coercion, but also as one of exchange.
Taxpayers are more inclined to comply with the law if the exchange between the paid tax and the performed government services are found to be equitable.
Hypothesis 2: The more extensive the citizens' satisfaction with public officers and the political system, the higher their intrinsic motivation to pay taxes.
The transformation of the socialist economies into capitalist economies was one of the reasons for such an explosion of corruption, which increased because of the lacking rule of law and accountability of the governance.
Countries with more corruption have a higher share of unofficial economy.
Previous empirical studies have found that corruption is negatively associated with government expenditure on education.
Insecurity of property rights and corruption might also have an impact on tax morale.
Corruption is an integral part of Albania's economy and has the negative consequence that citizens have less trust in the authority.
From previous studies in some transition countries the degree of corruption exceeds the total expenditures on science, education, health care, culture, and art.
In some industrial branches criminal groups spend up to 50% of their revenues to bribe officials.
Corruption generally undermines the tax morale of the citizens, because they get frustrated.
Taxpayers will feel cheated if they believe that corruption is widespread and their tax burden is not spent well.
Corrupt bureaucracy will not award the services to the most efficient producers, but to the producer who offers the larger bribes.
Thus, corruption reduces the efficiency of allocation and produces delays in transactions to acquire additional payments.
Such tendencies might have a strong impact on tax morale.
Hypothesis 3: A higher perceived size of corruption crowds out the public spirit, which reduces tax morale.
A way to combat the corruption would be the creation of a mechanism, where every his part would be a scheme.
Every his part must be in correlation with an expecting message to report vulnerably from taxpayers.
In the time when the law is a joint-venture with the daily routine of officers it is necessary the regulation of strategy of the control for every change of fiscal laws and fiscal tariffs.
This is in correlation with the penalty that must be put in every time for the evaders, which is the more interested to profit from these changes of laws.
The highest authority of tax administration should motivate the tax inspector to be interested in tax bonus, like an "gratuity" that is coming not from tolerance to evaders, but as a higher price for their work done, for the taxes they collect.
Maybe, if the tax inspectors could be more motivated for the work done according to the value of collection of taxes and natural penalty would be optimal in maximalization of tax revenues.
Tis would be helpful to minimize the corruption and to achieve the maximalization of tax revenues, but with tax inspector characterized by the honesty in their job.
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