Integrity and Service are Both Needed to Boost Voluntary Compliance
Our system of tax administration is based on the premise that taxpayers will
self-assess their tax obligations, file their taxes honestly, and pay what
they owe on their own initiative. For taxpayers to achieve higher levels of
tax compliance voluntarily, they must first regard tax compliance as an
expected social norm, an obligation they are expected to meet.
Secondly, taxpayers must have the information available to them to make their
tax obligations easy to understand and fulfill. The
IRS
does little to stress the need for integrity in the self-assessment process,
yet the Oversight Board’s annual taxpayer attitude survey found strong
support for personal integrity as a principal factor in paying taxes
honestly. The survey found that 86 percent of respondents cite personal
integrity as a principal factor influencing whether they report and pay their
taxes honestly.
The IRS
needs to find ways to leverage this strong support of voluntary compliance
as a critical civic duty. It must remind taxpayers that tax compliance is a
“social norm” expected of every taxpayer, much like obeying laws
against shoplifting or drunk driving, and that noncompliance with taxes
hurts our great nation. Such campaigns can have a long-term effect on public
opinion, such as that wages by Mothers Against Drunk Driving to reduce the
number of alcohol-related traffic fatalities. In a similar vein, the Motion
Picture Association of America created an aggressive campaign that equaled
downloading music or movies illegally with stealing.
The Board is particularly concerned that the tax compliance message be
reinforced with America’s young people. All members of the tax administration
community can help disseminate this message. For example, the National
Society of Tax Professionals (NSTP) is
receiving high marks for its “Teaching Taxes to High School Students.” This
presentation could be an excellent candidate for the
IRS and
NSTP to partner and create a similar product on the national level.