Voluntary versus enforced tax compliance: the slippery slope framework in the Brazilian context

Abstract

Research on tax compliance was initially conducted using the classical economic paradigm. However, several papers have demonstrated that this “crime paradigm” only partially explains taxpayer behavior. In this context, a new pattern emerged, labeled the “service paradigm,” which assumes that taxpayers are not rational individuals only concerned with maximizing usefulness; they should also receive proper treatment and good-quality public services in return for paying taxes. This paper aims to evaluate both paradigms and their influences on the tax collection level and seeks to determine whether they affect enforced and voluntary tax compliance. The theoretical assumptions were verified through empirical assessment using an online experimentation method with Brazilian taxpayers. The results confirm the existence of trust-based interactions between taxpayers and public administration that leads to voluntary compliance, while policies based on the imposition of power result in enforced compliance.