Do your tax problems make tax evasion seem more justifiable? Evidence from a survey experiment

• Published in: European Journal of Political Economy Vol. 78; p. 102365
• Main Author: Blesse, Sebastian
• Format: Journal Article
• Language: English
• Published: Elsevier B.V 01.06.2023
• Subjects: Support for tax compliance; Survey experiments; Tax complexity; K42; C90; Survey experiments; Tax complexity; Support for tax compliance; H26
• ISSN: 0176-2680
• DOI: 10.1016/j.ejpoleco.2023.102365

Taxpayers often view tax rules and filing processes as complicated. I study whether the perceived tax uncertainty among peers makes tax evasion more acceptable among the general public. I find strong supportive evidence for this hypothesis using a survey experiment and a large representative sample of the German population. Providing randomized information that others are uncertain about how to file their taxable income decreases individual support for tax compliance. This suggests that subjects judge tax evasion less harshly in response to this peer information. Studying related heterogeneous treatment effects, I find that both older and left-wing subjects are more responsive to tax uncertainty of others. Less harsh views on evasion are persistent for very high compliance levels in a follow-up survey. •Does tax filing uncertainty among others make tax evasion more acceptable?•I analyze a survey experiment for a representative sample of German citizens.•Information about tax uncertainty among peers makes evasion more tolerable.•Both older and left-wing subjects are more responsive to others’ tax problems.•Reductions of very high support levels for tax compliance persist for two months.