An Exploratory Investigation of Extrinsic and Intrinsic Motivations in Tax Amnesty Decision-Making
Year: 2016
Type: article
Study design: Observational Study
Abstract: The tax compliance literature on tax amnesties does not explicitly consider the underlying motivational influences on taxpayers’ self-correction decisions. Extant tax amnesty studies imply that extrinsic motives are the basis for self-correction, and only a few consider intrinsic motives (Rechberger, Hartner, Kirchler & Hämmerle, 2010; Torgler & Schaltegger, 2005). Consequently, we explore how extrinsic and intrinsic motives affect tax amnesty decision-making, following an unintentional taxpayer error. We conduct a quasi-experimental conjoint analysis on 1,266 taxpayers and vary the error magnitude. Results indicate that when taxpayers contemplate making a tax amnesty disclosure, desire to avoid a penalty is the most influential extrinsic motive, and responsibility to pay one’s taxes is the most influential intrinsic motive. Extrinsic (intrinsic) influences account for about two-thirds (one-third) of the overall decision to make a tax amnesty disclosure. We also find that taxpayers’ choices of extrinsic and intrinsic motives do not vary according to tax error magnitude. Implications for tax authorities and tax researchers are discussed.
Source: Journal of Tax Administration
Authors: Jonathan Farrar, Cass Hausserman
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W2557402539