The Effect of Tax Authority-Developed Software on Taxpayer Compliance

What is it about?

More and more taxpayers are using tax software each year, but we know little about how using software influences taxpayers reporting decisions. Results show that when taxpayers use tax software created by a third party commercial software developer, they report more aggressively when they owe taxes compared to when they are due a refund. However, when the software is developed by the tax authorities taxpayers report similarly in both the tax-due and refund positions. In addition, the taxpayers in a tax-due position report less aggressively when using tax authority developed software.

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