Issues on compliance and ethics in taxation : what do we know?

Daniel HO, Brossa WONG

Research output: Journal PublicationsJournal Article (refereed)peer-review

18 Citations (Scopus)


Purpose To better understand the issues on compliance and ethics in taxation, this paper reviews and discusses the extant literature with a focus on individual taxpayers. As prior studies mainly provide tax compliance and ethics information in the USA, this paper attempts to explore similar issues in a nonUS economy by articulating reallife perspectives of tax compliance behavior in Hong Kong. Design/methodology/approach The first part of this study undertakes an extensive review of literature on compliance and ethics in taxation. The second part of this study provides reallife perspectives of tax compliance behavior for individual taxpayers by examining three informal tax cases in Hong Kong. Findings The first major finding from literature review is that ethical beliefs could be an effective means to improve tax compliance, particularly for taxpayers with lower levels of moral development. Secondly, as tax compliance rate is higher when taxpayer has a stronger moral belief that tax evasion is not ethical, a stronger enforcement effort might have a positive overall effect on tax compliance. Research limitations/implications In Hong Kong, there is a lack of general ethics education for the public. The authors therefore suggest the introduction of general ethics education for all citizens in Hong Kong to enhance level of moral development in order to improve tax compliance at large. Originality/value The examination of the actions of taxpayers provides insightful information on tax compliance and ethics issues as prior research suggests that ethics ultimately lies in actions and hence actions should be used to study the ethical development.

Original languageEnglish
Pages (from-to)369-382
Number of pages14
JournalJournal of Financial Crime
Issue number4
Publication statusPublished - 10 Oct 2008


  • Ethics
  • Hong Kong
  • Taxation

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