I have written before about the interesting differences between the genders when it comes to financial crime. And now there is a new study, published in the December 2017 issue of the Journal of Behavioural and Experimental Economics (surely you subscribe), which explains how recent research has revealed that men are significantly more likely than women to evade paying tax.
During the study (the full results of which you can buy here for US$31.50), nearly 1,500 people who submit self-reported tax returns were surveyed in the US, the UK and Sweden. They were asked to perform a mock clerical task which entitled them to earn a small amount of money. They were also told that they would be taxed and were asked to self-report their income. They were warned that there was a 5% chance that their earnings would be audited, and that if they were caught evading tax, they would have to pay a financial penalty double to value of whatever tax they were meant to pay. Different experiments were conducted with varying tax rates and structures.
According to John D’Attoma – from the University of Exeter Business School and part of the research team: “We have found robust evidence that tax compliance is greater for women than men. But men are more responsive to the incentives attached to paying taxes. We wanted to test both willingness to pay taxes, and willingness to contribute to public services. Our results suggest overall women are more willing to pay taxes and men respond more to the fact that they will get something, such as a public good, in return for their tax money. Women are compliant even when they do not expect anything in return, and we had this result in every country where we ran the experiment. This shows that equal pay and measures to bring more women into the labour market could really have an impact in shrinking the tax gap.”
In other words, if governments want to collect more tax, they need to get more women into the workforce, and eliminate the gender pay gap. And if men want to evade tax more discreetly, perhaps they need to assume a female persona, now that this research has been made public.