Multidimensional tax compliance attitude

Abstract

This paper theorizes that individuals’ tax compliance attitudes are characterized not only by interpersonal heterogeneity but also by intrapersonal heterogeneity. Utilizing three online surveys, we develop a multidimensional taxpayer typology based on factor and cluster analysis. Our findings underscore that taxpayers can be classified into two categories: (a) moralists and (b) rationalists. Notably, rationalists consistently exhibit lower tax compliance levels than their moralist counterparts. We introduce a questionnaire labeled the Tax Compliance Attitude Inventory (TCAI) alongside a classification algorithm. These tools enable users to categorize individuals in any dataset, applying the TCAI, as moralists and rationalists. The heterogeneity in taxpayer attitudes can primarily be attributed to differences in four key factors: (i) morale, (ii) monetary benefit, (iii) deterrence, and (iv) authority. Lastly, to demonstrate the practical application of our findings, we present an online experiment that tests our results using incentivized and out-of-sample data. Overall, this work provides an instrument for assessing taxpayer attitudes, predicting individuals’ tax compliance intentions, and personalizing behavioral interventions.