Most people don’t cheer when tax season arrives. But while some file diligently, others bend the rules—or break them entirely. The difference between the two is more than just math. It’s about trust, perception, and the complex psychology of our relationship with the state.
In “Integrating Explanations of Tax Evasion and Avoidance,” Erich Kirchler explores why people don’t always pay their fair share, and what that says about how we see ourselves as citizens. His work weaves together economic, psychological, and sociological insights to paint a rich, human portrait of tax behaviour—one that sees tax evaders not just as lawbreakers, but as people navigating an emotional and moral landscape.
The Many Faces of Non-Compliance
Let’s begin with a distinction:
- Tax evasion is illegal—it’s underreporting income, inflating expenses, or hiding assets.
- Tax avoidance, by contrast, is legal but often ethically questionable—using loopholes or complex structures to reduce tax liability.
But Kirchler urges us not to treat these behaviours as binary or isolated. Instead, they exist on a continuum of compliance. People don’t simply “evade” or “comply”—they weigh trade-offs, justify decisions, and adjust their behaviour based on internal and external cues.
What drives those choices?
Beyond Greed: A Matter of Trust and Fairness
One of Kirchler’s central insights is that non-compliance is often not about greed. It’s about trust.
If people believe the tax system is fair, transparent, and that others are also paying their share, they’re more likely to comply. But when they feel the system is corrupt, inefficient, or unjust, a psychological shift happens. Taxes begin to feel like theft, not contribution.
This leads to a powerful paradox: enforcement alone doesn’t guarantee compliance. In fact, overly aggressive controls can reduce voluntary cooperation. Why? Because when people feel they are treated like suspects, they act like suspects.
Kirchler introduces the “slippery slope framework”, which shows that compliance increases not just with deterrence (fear of punishment) but also with legitimacy (feeling that the system is worth supporting).
The Inner Narratives of Taxpayers
People justify their tax behaviour in deeply personal ways. Here are some of the most common narratives Kirchler explores:
- “I’m just one person—it won’t make a difference.” This reflects a sense of powerlessness and disconnect from the collective.
- “Everyone does it.” This is social norming. When tax dodging is perceived as widespread, individual guilt weakens.
- “I don’t trust the government with my money.” This shows how institutional trust affects moral judgment.
- “I’ve paid enough already.” This belief often emerges in high-tax environments or where services feel inadequate.
These aren’t just excuses. They are emotional responses to a system that can feel opaque, unequal, or indifferent. Addressing them requires more than audits—it requires understanding.
The Role of Culture and Context
Tax behaviour doesn’t exist in a vacuum. It is shaped by culture, history, and institutional design.
In some countries, paying taxes is seen as a civic duty. In others, it’s seen as a burden or a game to be navigated. Kirchler highlights how cultural attitudes toward the state—shaped by past experiences of corruption, instability, or inequality—can influence how people see taxation today.
Policy, then, must be culturally sensitive. A one-size-fits-all approach to compliance won’t work. What motivates taxpayers in Denmark may not work in Brazil, South Africa, or the Philippines.
Toward a Human-Centered Tax System
Kirchler doesn’t argue for less enforcement. Rules matter. But he calls for a rebalancing—one that recognizes that people are not purely rational actors but emotionally and morally driven beings.
The key, he suggests, is to foster:
- Trust in institutions – through transparency, fairness, and good governance.
- Voluntary cooperation – by emphasizing shared values and social norms.
- Responsive enforcement – that targets fraud but respects honest taxpayers.
When people feel heard, respected, and part of something larger than themselves, they’re more likely to give—willingly.
Final Reflection: From Taxpayer to Citizen
Taxes are never just financial. They are moral acts, reflections of how much we believe in the common good, and how much we trust those who administer it.
Erich Kirchler’s work reminds us that to truly understand tax evasion and avoidance, we must look not only at the numbers, but at the narratives behind them.
When people ask, Why should I pay?—they’re often asking a deeper question: Does anyone care? Does this system reflect me? Are we in this together?
If we want better tax systems, we must design not just for compliance, but for connection. Because in the end, taxation is not just a policy. It’s a relationship.