The Effect of Trust on Tax Morale: A Cross-Country Research

Konukcu Önal D.

Mali Çözüm, vol.31, no.163, pp.93-122, 2021 (Peer-Reviewed Journal)

  • Publication Type: Article / Article
  • Volume: 31 Issue: 163
  • Publication Date: 2021
  • Journal Name: Mali Çözüm
  • Journal Indexes: TR DİZİN (ULAKBİM)
  • Page Numbers: pp.93-122
  • Hacettepe University Affiliated: Yes


Debates in the field of public fiscal-management assert that tax morale is at least as essential as punishments and enforcements for fulfilling the tax obligations. Especially, the absence of individuals with high tendency for evading taxes in countries where tax audits and punishments are relatively low, implies the presence of a positive social-capital effect on individuals in the society they live. The tax morale and its tax compliance outcome, which are shaped by value judgements that are transferred from the past to future in a society, are closely related with the quality of the social capital stock of that society. Within this framework, this study aims at exploring how trust, an essential ingredient of social capital, affects the tax morale. In the study, with respect to this objective, cross-section regression estimations are carried out across countries by using the data from the World Values Survey, which is conducted to thousands of people in 60 countries. In these regression estimations, various quantitative indicators with different contents are used for measuring the level of trust in each of the countries. As a result of these estimations, tax morale is found to be high in countries where individuals’ trust to the governmental system and to each other are high. This implies that trust, which is a type of social capital transferred institutionally in a society from the past to the present, is a factor that encourages the voluntary tax compliance beside the coercive precautions taken by governments to increase the tax compliance.