Trust in Authorities and Power to Enforce Tax Compliance: An Empirical Analysis of the 'Slippery Slope Framework'

24 Pages Posted: 7 Sep 2010  

Ingrid Wahl

affiliation not provided to SSRN

Barbara Kastlunger

affiliation not provided to SSRN

Erich Kirchler

University of Vienna - Department of Psychology

Abstract

Tax payments are enhanced by taxpayers' trust in authorities or by authorities' power leading to voluntary or enforced tax compliance, respectively. A laboratory experiment and an online experiment examined these assumptions, manipulating trust in and power of authorities. In Experiment 1, participants paid taxes in twenty periods. Results showed that trust and power positively influence tax payments. Trust increases and power decreases voluntary compliance, whereas power increases and trust decreases enforced compliance. Experiment 2 analyzed the impact of trust and power with self-employed taxpayers' intentions to pay taxes. The overall pattern of the findings of Experiment 1 were replicated and expanded with strategic behavior; strategic behavior was higher in the case of low trust and high power when compared to that of high trust and high power.

Suggested Citation

Wahl, Ingrid and Kastlunger, Barbara and Kirchler, Erich, Trust in Authorities and Power to Enforce Tax Compliance: An Empirical Analysis of the 'Slippery Slope Framework'. Law & Policy, Vol. 32, Issue 4, pp. 383-406, October 2010. Available at SSRN: https://ssrn.com/abstract=1670376 or http://dx.doi.org/10.1111/j.1467-9930.2010.00327.x

Ingrid Wahl (Contact Author)

affiliation not provided to SSRN

No Address Available

Barbara Kastlunger

affiliation not provided to SSRN

No Address Available

Erich Kirchler

University of Vienna - Department of Psychology ( email )

Universitaetsstrasse 7
Vienna, A-1010
Austria
+43 1 42 7747880 (Phone)
+43 1 42 7747889 (Fax)

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