Tax compliance and firms' strategic interdependence
Bayer, R. & Cowell, F.
(2009).
Tax compliance and firms' strategic interdependence.
Journal of Public Economics,
93(11-12), 1131-1143.
https://doi.org/10.1016/j.jpubeco.2009.07.007
(2009).
Tax compliance and firms' strategic interdependence.
Journal of Public Economics,
93(11-12), 1131-1143.
https://doi.org/10.1016/j.jpubeco.2009.07.007
We focus on a relatively neglected area of the tax-compliance literature in economics, the behaviour of firms. We examine the impact of alternative audit rules on receipts from a tax on profits in the context of strategic interdependence of firms. The enforcement policy can have an effect on firms' behaviour in two dimensions — their market decisions as well as their compliance behaviour. An appropriate design of the enforcement policy can thus have a “double dividend” by manipulating firms in both dimensions.