Tax Compliance and Taxpayer Mood: Will COVID-19 Lead to an Epidemic of Tax Cheating?

Research in cognitive psychology suggests that mood influences the way people process information (e.g., George Loewenstein, "Emotions in Economic Theory and Economic Behavior," American Economic Review, 2000, vol. 90, no. 2, pp. 426-432; Norbert Schwarz and Ian Skurnik, "Feeling and...

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Veröffentlicht in:The CPA journal (1975) 2020-12, Vol.90 (12), p.60-63
Hauptverfasser: Lynch, Edward J, Durrant, Jon
Format: Artikel
Sprache:eng
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Zusammenfassung:Research in cognitive psychology suggests that mood influences the way people process information (e.g., George Loewenstein, "Emotions in Economic Theory and Economic Behavior," American Economic Review, 2000, vol. 90, no. 2, pp. 426-432; Norbert Schwarz and Ian Skurnik, "Feeling and Thinking: Implications for Problem Solving," The Nature of Problem Solving, J. Davidson and R.J. Sternberg, eds., 2003, pp. 263-292). [...]taxpayers may be motivated to manage/mitigate their negative mood by seeking the positive satisfaction associated with being honest and responsible. [...]one might predict that when people are in a negative mood, they are more likely to apply a more analytical or detailed approach in order to avoid the potential negative consequences associated with an aggressive tax strategy. The second manipulated condition was the amount of the potential tax liability (i.e., $500 vs. $5,000). [...]in total, there were four different settings (positive mood and low tax amount, positive mood and high tax amount, negative mood and low tax amount, and negative mood and high tax amount). The third section of the data collection instrument required the participants to read a tax case about a full-time college student (Jesse) who works part-time and is considering taking an aggressive tax position to help lower an unexpected tax bill.
ISSN:0732-8435