Tax compliance costs
Eichfelder, Sebastian ;  Schorn, Michael ;  ;  Universität <Berlin, Freie Universität> / Fachbereich Wirtschaftswissenschaft

Main titleTax compliance costs
Subtitlea business administration perspective
AuthorEichfelder, Sebastian
AuthorSchorn, Michael
EditorUniversität <Berlin, Freie Universität> / Fachbereich Wirtschaftswissenschaft
No. of Pages33 S.
Series ; 2009,3 : Betriebswirtschaftliche Reihe
KeywordsTax complexity, tax compliance costs, bureaucracy costs, tax administration,
Classification (DDC)336 Public finance
AbstractOur paper analyses the relationship of tax compliance costs and business strategy. Due to instruments, like information technology, simplified cash accounting or outsourcing compliance activities to tax advisers, private businesses have a set of strategies to optimize their tax compliance cost burden. Under the assumption of rational choice a private business chooses a cost-optimal administration strategy. Nevertheless we find empirical evidence for
small German businesses using only insufficiently the support of external tax advisers. Therefore a considerable number of small businesses in Germany would be able to reduce their compliance cost burden by a higher degree of outsourcing tax processes. By contrast we find no significant evidence for a cost reduction by an electronic data interchange with the tax and social insurance authorities or by a simplified cash accounting method for tax purposes.
The insufficient use of external advice may be explained by bounded rationality arguments, like an overconfidence of the taxpayer as well as a cost perception deficit. An alternative motivation could be a mistrust of the taxpayer against an external tax adviser.
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FU DepartmentDepartment Business and Economics
Other affiliation(s)Institut für Betriebswirtschaftliche Prüfungs- und Steuerlehre
Year of publication2009
Type of documentBook
Terms of use/Rights Nutzungsbedingungen
Created at2009-07-08 : 10:53:23
Last changed2016-01-05 : 02:38:15
Static URLhttp://edocs.fu-berlin.de/docs/receive/FUDOCS_document_000000002573