We study the effects of the tax burden on tax evasion both theoretically and experimentally. We develop a theoretical framework of tax evasion decisions that is based on two behavioral assumptions: (1) taxpayers are endowed with reference dependent preferences that are subject to hedonic adaptation and (2) in making their choices, taxpayers are affected by ethical concerns. The model generates ...

I quantitatively study the optimal capital income taxation in the general equilibrium overlapping generations model with uninsurable idiosyncratic income shocks and with housing and flnancial assets. Following key characteristics of housing are explicitly modeled: (i) housing is held for the dual purpose of consumption and savings, (ii) housing can be either owned or rented, (iii) if owned, hou...

this paper aims at comparing tax effort in iran with that of 14 developing countries including jordan, algeria, malaysia, congo, nicaragua, india, sri lanka, paraguay, tunisia, peru, venezuela, philippine, and south africa. a tax ratio model is developed for this purpose. seemingly unrelated regression (sur) method and panel data for 1994-2002 periods are utilized to estimate the model. the res...

Background: Value added tax as an indirect tax is one of the effective sources of government tax revenue and the study of its economic effects is the focus of many economic studies. Therefore, the purpose of this article is to investigate the effect of VAT on the stability of the public sector economy in Iran with the approach of promoting tax ethics and culture. Method: The present study was ...

In many OECD countries, statutory corporate tax rates are lower than personal income tax rates. The present paper argues that this tax rate differentiation is an optimal tax policy if there are problems of asymmetric information between investors and firms in the capital market. The reduction of the corporate tax rate below the personal tax rate encourages equity financing and thus mitigates th...

This paper analyzes the consequences of incorporating a different rate for tax depreciation than for economic depreciation. Firms most often choose their tax depreciation rate in a strategic way. It would therefore be a coincidence if this optimization process leads to a tax depreciation rate that equals the economic depreciation rate. The implications of a difference between tax depreciation a...

The relative constancy of nonfinancial corporate tax revenues as a share of U.S. GDP masks offsetting trends in the ratio of corporate profits to GDP (declining) and the average tax rate (increasing). The average tax rate rose steadily between 1996 and 2003, an increase largely attributable to the importance of tax losses. This rise casts some doubt on the role of tax planning activities in red...