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Cover von: Tax Compliance Costs: A Business-Administration Perspective
Sebastian Eichfelder, Michael Schorn

Tax Compliance Costs: A Business-Administration Perspective

Rubrik: Articles
Jahrgang 68 (2012) / Heft 2, S. 191-230 (40)
Publiziert 09.07.2018
DOI 10.1628/001522112X639981
Veröffentlicht auf Englisch.
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  • 10.1628/001522112X639981
Using instruments like information technology and paid preparation of tax returns, private taxpayers have a set of strategies to optimize their compliance cost burden. Assuming rational behavior, private businesses can be expected to choose a cost-optimal administration strategy. Nevertheless, we find empirical evidence of small German businesses, in particular, using external support to an insufficient extent. According to our results, doubling the proportion of outsourced compliance activities results in cost reductions of 14.4% to 24.9%. By contrast, we do not find significant evidence for a cost reduction due to an electronic data interchange with the tax and social insurance authorities or the use of a simplified cash accounting method. Therefore, our results give reason for doubt regarding potential cost reductions that could be reached by e-filing or cash-based accounting.