What Does Voluntary Tax Compliance Mean?: A Government Perspective

8 Pages Posted: 3 May 2015 Last revised: 23 Oct 2016

See all articles by Jack Manhire

Jack Manhire

Texas A&M University School of Innovation; Bush School of Government & Public Service

Date Written: 2015

Abstract

One of the IRS’s principal goals is to maximize voluntary compliance. Yet, there is often a great deal of confusion and consternation when taxpayers discover that the IRS refers to the annual filing and payment ritual as “voluntary;” especially since most taxpayers do not believe they have a choice when it comes to filing and paying their taxes. What does voluntary compliance mean? Does it mean taxpayers can volunteer to file returns and pay taxes, much as one might volunteer to make a charitable donation? Does it mean taxpayers don’t have to comply with the tax laws if they don’t feel like it? How can it be a federal crime to not file or pay taxes if compliance is voluntary? This essay offers a government perspective as to why the IRS uses this sometimes perplexing term. After investigating (and dismissing) a possible literal defense, the essay surveys the IRS’s history to see why voluntary compliance is such a critical part of the U.S. tax system. The essay then recommends changing the term from voluntary to cooperative compliance to retain the government’s meaning while lessening taxpayer confusion.

Keywords: voluntary compliance, tax, taxation, cooperative, game theory

JEL Classification: H20, H24, K34, E62

Suggested Citation

Manhire, Jack, What Does Voluntary Tax Compliance Mean?: A Government Perspective (2015). 164 University of Pennsylvania Law Review Online 11 (2015); Texas A&M University School of Law Legal Studies Research Paper No. 16-58. Available at SSRN: https://ssrn.com/abstract=2601613

Jack Manhire (Contact Author)

Texas A&M University School of Innovation

1249 TAMU
College Station, TX 77843-1249
United States

Bush School of Government & Public Service ( email )

4220 TAMU
College Station, TX 76845
United States

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