The influence of taxpayers behavioral factors on tax evasion

Abstract

The article examines the limitations of an objective and subjective nature when studying the processes of tax evasion that arise within the framework of the concept of rational choice. Using the behavioral an experimental economics tools, it is shown that the specificity of decision-making by taxpayers leads to the need to include social, demographic, an other factors of an individual and group nature in the model. The simulation results indicate that compliance with tax legislation significantly depends on the level of trust in government authorities and the subjective perception o the fairness of the current tax system. Taxpayers have a personal opinion, which, together with existing social ties, influences the choice of an appropriate behavior model. Further development of research on tax evasion processes requires the development of more detailed methods that take into account the heterogeneity of taxpayer groups, social norms, and accepted stereotypes of behavior at the subnational level.