The rapid growth in online commerce has harmed state sales tax bases. However, the extent of this base reduction is difficult to estimate. In this paper we collect our own data from eBay.com on a "representative" commodity classification and a "typical" day. Our data consist of nearly twenty-one...

The traditional "enforcement" paradigm of tax administration views taxpayers as potential criminals, and emphasizes the repression of illegal behavior through frequent audits and stiff penalties. However, an important trend in tax administration policies in recent years is the recognition that...

Many previous studies have examined the level of state grants to local K-12 school districts. However, these studies have not considered the role of citizen "trust" in state versus local governments as a factor. We hypothesize that the role of the state in funding education reflects citizen...

How does online cross-border shopping affect state use tax liabilities? We collect our own data on actual online cross-border shopping transactions from eBay.com, focusing upon a "representative" commodity classification and a "typical" day. These data allow us to examine the extent of actual...

Online commerce presents consumers with a convenient way of shopping outside of their local jurisdiction, and this online purchase decision is capable of affecting in significant ways the sales and use tax collections of state governments. However, the actual revenue impact has proven difficult...

In this paper we argue that puzzle of tax compliance can be explained, at least in part, by recognizing the typically neglected role of ethics in individual behavior; that is, individuals do not always behave as the selfish, rational, self-interested individuals portrayed in the standard...

This paper examines the effect of "empathy" and "sympathy" on tax compliance. We run a series of laboratory experiments in which we observe the subjects' decisions in a series of one-shot tax compliance games presented at once and with no immediate feedback. Importantly, we employ methods to...

The paper estimates the size of shadow economy for 111 countries for the years 1984 to 2006 based on the currency demand approach. An important innovation is our use of dynamic panel data methods, which allows us to make several important contributions. First, we estimate the shadow economy for...

The standard assumption underlying the incidence of tax evasion is that the beneficiaries are those who successfully evade their taxes. However, a general equilibrium process of adjustment should occur through changes in the relative prices of both commodities and factors of production as...

In this paper we give our perspective on the different paradigms that have shaped – and seem likely to shape in the future – research in the field of tax compliance behavior. These research paradigms include viewing tax evasion as a decision under risk made by a single taxpayer, as...