Vertical taxing rights and tax compliance norms

This paper investigates the effects of multi-layer tax arrangements on compliance norms and behaviours individuals in 49 Latin American African countries. To date, literature predominantly portrays government-taxpayer relationship as bilateral. In practice, however, taxpayers have multiple payment obligations often towards more than one tier government. argues for consideration multi-level cross-country empirical enquiries behaviours. It draws from existing to posit that vertical decision structure matters by different government layers could influence through, instance, altering enforcement parameters, affecting costs or shaping fiscal exchange between citizens State through elements trust, perception public accountability redistribution, utility. The findings suggest assigning taxing rights discretionary powers administration subnational governments lower tendencies compliance. confirms overarching hypothesis inter-governmental matter understanding norms. results are robust specifications, including use instrumental variables address endogeneity concerns.