The Research Of Tax Compliance

In recent50years, the scale of "Shadow economy" in most countries expanded rapidly. According to statistics, the amount of Europe's shadow economy estimated has reached2.2trillion Euro in year2011, which took up official GDP of different countries at least8%, and at most exceeded30%. During our "Eleventh Five-Year Plan" period, tax audit department checked and collected evaded tax for346.8billion, which increased237.6billion compared with the figures in "Ten Five-year Plan" period. According to research, the main reason for shadow economy is tax incompliance, which is a long-time difficult lesson for all governments in the world. In order to reveal the secret of tax compliance, foreign scholars have done hard and innovative research abundantly, and gained some remarkable results, whose theoretical basis are Expected Utility Theory and Prospect Theory.China imported from western world and started the research of tax compliance just after the90's; but distance still exists between China and the western in width and depth. As a part of aiding China's tax reform and taxation management reform which funded by NUDP and entrust IMF to implement, our government issued "2002-2006China's strategic plan for tax collection and management" in Mar. of2003, which raised the conception of "tax compliance" officially for the first time.Influenced by taxation structure in western developed countries and the complicated condition of company taxpayers, foreign scholars' research mainly focused on personal taxpayers, while seldom on company taxpayers. However, in China, company taxpayers--as the main part of tax declaration, whose tax compliance rate will have great influence on our state's revenue worth an in-depth study.The existence of principal-agent relationship provides a visual angle for studying the tax compliance of company taxpayers. This article on the basis of existing research results for personal taxpayers, takes personal agential tax compliance as a breakthrough, and study the company taxpayer as a final goal, which provides several policy proposals for our taxation collection and administration practice through theoretical and empirical studies.Section1introduces the background, meaning, target, summarization, frame, outline, and innovation of the thesis.Section2summarizes the Principal-agent Theory. Expected Utility Theory and Prospect Theory, and provides the theory basis for following research.Section3analyzes the main economical factors and non-economic factors that influence the tax compliance for personal taxpayer, including audit rate, penalty rate, tax rate, income, tax compliance cost, public goods supply, tax service, tax justice, tax morality, natural attribute. The questionnaire survey for taxpayer satisfaction, requirement and tax compliance organized by Suzhou survey group of NBS indicates that some factors which have influence on tax compliance of personal taxpayer will also on the (person) agent, and finally have influence on company taxpayers; agent of medium-sized and small enterprises are more sensitive to the factors and will cause more influence on company's tax compliance.Section4builds a tax compliance model which on the basis of A-S-Y model with the significant modification of parameter such as the influence factors of income and penalty and on the basis of Expected Utility Theory in principal-agent relationship:analyzes the differences in three conditions based on the premise for stable income and proportion income, introduces the application of the model and comes to the conclusion that penalty is a must to personal agent in order to restrain the company's tax evasion; When in stable income condition, the agent tends to tax compliance; When in proportion income condition, it needs to be discussed in different situations. This article suggests to resolve the problem by increasing the penalty to agent and making the coefficient over1.Section5studies the psychological change of personal agent in the tax compliance decision making process through controlling experiment. The result shows that framing effect existing, and realizes with the prediction, which proves that the Prospect Theory can better describes the decision making process for the decision makers, and the income location after the tax payment can be a reference point for personal agent to choose.Section6on the basis of previous section builds a tax compliance model which based on the personal income evade tax model of Dhami and al-Nowaihi(2006) who relyed on Prospect theory with the significant modification of parameter such as the influence factors of income and penalty and based on Prospect theory in principal-agent relationship. The model clears the relationship between actual declared tax base and agent income, agent penalty, tax rate and risk aversion coefficient. Then it introduces the application of the model. The conclusion shows that correction between actual declared tax base and agent income, tax rate is negative, while the correction between actual declared tax base and agent penalty, risk aversion coefficient is positive.Section7provides some policy suggestions for increasing personal agents and company taxpayers' tax compliance level through the angel of taxpayer, tax administration, and government&social environment, which is based on the research of previous sections. At last,it also points out the direction of our efforts in future.