Study On Influencing Factors Of Taxpayer Compliance

The phenomena of taxpayer noncompliance and tax loss are common problems for tax administrating authorities in many countries. Even in the USA, the phenomena are relatively severe. As for China,90%of the fiscal revenue comes from tax collection, and the taxpayer noncompliance appears obvious during a period that the economy transits and the gap between rich and poor grows rapidly. This has affected the construction of harmonious society and the development of taxation system. Using literature research method, interview method, questionnaire method and statistical analysis, and comprehensively applying related theories like behavior psychology, this paper made a further study on the action mechanism and influencing factors of taxpayer compliance, in which the questionnaire method and empirical research made for the influence of economic, political and moral factors on taxpayer compliance was conducted early in China. This study is beneficial to the deep development of taxpayer compliance research, establish taxpayer compliance data library in the future which similar to the U.S, and strengthens the tax basic management and provides corresponding theoretical support for deepening governmental and taxation reform and improving the tax collection and administration.Based on the methods of structural interview and questionnaire, the author interviewed with ten odd persons in charge or executives of corporations of various nature, category or scale in Changsha and Zhuzhou, and investigated nearly one thousand of taxpayers by means of random questionnaire in Changsha. Lots of data have been collected. Main study contents of this paper are as follows:1. Action mechanism of taxpayer compliance was studied theoretically. Related theories on taxpayer compliance were inducted and analyzed, and some relevant concepts were re-discriminated. On the basis of related theories like behavior economics, the paper put forward a new theoretical frame for the behavior study on taxpayers’ compliance and, as viewed from economics, politics and morality, made theoretical analysis on related factors influencing tax-pay compliance and their action modes. 2. Model construction and empirical analysis were conducted for the influence of economic, political and moral factors on taxpayer compliance. According to behavioral economics theory, the related influencing factors were factorized and inducted. The data from questionnaire were also analyzed. In addition, these factors and models were examined and analyzed and a persuasive conclusion then came into being.3. Related theoretical hypothesis were studied and verified. As for the influence of economic factors, through centering on the basic point of comparison of cost and benefit, the influence of different cost expenditure factors on taxpayers’compliance will was studied; for influence of political factors, through centering on the government credibility, the action relation between taxpayer’s compliance will and credibility of tax authorities and related influencing factors were studied; for influence of moral factors, through centering on tax morality, the relation between taxpayer’s moral status and their compliance will and related influencing factors were studied.The following study conclusions were drawn by means of empirical research:1. The economical influence model for taxpayer compliance is composed of the distortion cost factor, tax executory cost factor, tax evasion cost factor and risk return factor. Through empirical research we find that among the influence of economical factors taxpayer’s compliance decision-making is affected by his educational level, age, income, industry involved, etc. Distortion cost factor is significantly correlated with taxpayer’s income, executory cost factor significantly correlated with taxpayer’s educational level and age, tax evasion cost factor significantly correlated with taxpayer’s educational level, risk return factor significantly correlated with taxpayer’s industry involved, respectively.2. The political influence model for taxpayer compliance is composed of the tax policy factor, work involvement factor and service effect factor. Through empirical research we find that among the influence of political factors taxpayer’s compliance decision-making is affected by his age, income, vocation status, educational level, etc. Tax policy factor is significantly correlated with taxpayer’s age and income, work involvement factor significantly correlated with taxpayer’s vocation status, service effect factor significantly correlated with taxpayer’s educational level and vocation status, respectively.3. The moral influence model for taxpayer compliance is composed of the social identity factor, mass-following psychology factor, moral cognition factor and social reputation factor. Through empirical research we find that among the influence of moral factors taxpayer’s compliance decision-making is affected by his age, industry involved, educational level, etc. Social identity factor is significantly correlated with taxpayer’s age, mass-following psychology factor significantly correlated with taxpayer’s age, moral cognition factor significantly correlated with taxpayer’s industry involved, social reputation factor significantly correlated with taxpayer’s educational level and industry involved, respectively.