The Ethics of Tax Evasion: An Empirical Study of Ecuador

16 Pages Posted: 30 Jan 2007  

Robert W. McGee

Fayetteville State University - Department of Accounting

Silvia López Paláu

University of Puerto Rico

Fabiola Jarrín Jaramillo

Pontifical Catholic University of Ecuador

Date Written: January 2007

Abstract

Although much research has been done on tax evasion from the perspectives of economics and public finance, not much has been done from the perspective of ethics. This paper is intended to partially fill that gap in the literature. This paper reviews the literature that has been published on the ethics of tax evasion, then proceeds to present the results of a study conducted in Ecuador that gathered opinions of 140 respondents on the ethics of tax evasion. The authors constructed a survey instrument that contained 18 statements representing the major arguments that have been made over the last 500 years to justify tax evasion. Respondents were asked to indicate the extent of their agreement or disagreement with each statement by placing a number from 1 to 7 in the space provided. Arguments were then ranked from strongest to weakest. Scores were also compared by gender. An analysis of the data found that there was no significant difference between male and female scores, a finding that corresponds to the findings of some similar studies but that differs from the findings of other studies. The strongest arguments to justify tax evasion were in cases where the government was excessively corrupt, where tax money was wasted or where the system was perceived to be unfair. This finding has policy implications. If governments want to reduce the amount of tax evasion, they need to reduce the amount of government corruption, spend tax money wisely and adopt tax policies that are viewed as fair.

Keywords: Ecuador, ethics, tax evasion, gender

JEL Classification: D6, E62, H26, J16, J1, K34, K42, M14, M4, O54

Suggested Citation

McGee, Robert W. and López Paláu, Silvia and Jaramillo, Fabiola Jarrín, The Ethics of Tax Evasion: An Empirical Study of Ecuador (January 2007). Available at SSRN: https://ssrn.com/abstract=960104 or http://dx.doi.org/10.2139/ssrn.960104

Robert W. McGee (Contact Author)

Fayetteville State University - Department of Accounting ( email )

Fayetteville, NC 28301
United States

HOME PAGE: http://robertwmcgee.com

Silvia López Paláu

University of Puerto Rico ( email )

Ponce De Leon Ave.
Puerto Rico
Rio Piedras, 00931-3300
Puerto Rico

Fabiola Jarrín Jaramillo

Pontifical Catholic University of Ecuador ( email )

Apartado 17-01-2184
Quito
Ecuador

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