Tax Compliance and Firms Strategicinterdependence

26 Pages Posted: 21 Feb 2008

See all articles by Ralph Bayer

Ralph Bayer

affiliation not provided to SSRN

Frank Cowell

London School of Economics & Political Science (LSE) - Suntory and Toyota International Centres for Economics and Related Disciplines (STICERD)

Date Written: February 2006

Abstract

We focus on a relatively neglected area of the tax-compliance literature ineconomics, the behaviour of firms. We examine the impact of alternativeaudit rules on receipts from a tax on profits in the context of strategicinter-dependence of firms. In the market firms may compete in terms ofeither output or price. The enforcement policy can have an effect onfirms&apos' behaviour in two dimensions - their market decisions as well astheir compliance behaviour. An appropriate design of the enforcementpolicy can thus have a "double dividend" by manipulating firms in bothdimensions.

JEL Classification: H20, H21

Suggested Citation

Bayer, Ralph and Cowell, Frank A., Tax Compliance and Firms Strategicinterdependence (February 2006). LSE STICERD Research Paper No. 81. Available at SSRN: https://ssrn.com/abstract=1094873

Ralph Bayer (Contact Author)

affiliation not provided to SSRN

No Address Available

Frank A. Cowell

London School of Economics & Political Science (LSE) - Suntory and Toyota International Centres for Economics and Related Disciplines (STICERD) ( email )

Houghton Street
London WC2A 2AE
United Kingdom
+44 (0)171-955 7277 (Phone)
+44 (0)171-242 2357 (Fax)

Register to save articles to
your library

Register

Paper statistics

Downloads
45
Abstract Views
885
PlumX Metrics