BOOK OF ABSTRACTS - University American College Skopje

OUT OF THE CRISIS: EU ECONOMIC AND SOCIAL POLICIES RECONSIDERED8 th annual international conference on European integrationMaja Ristovska, Assoc. Prof. Nikica Mojsoska-Blazevski, PhDUniversity American College Skopje, Macedonianikica@uacs.edu.mk; maja.nestorovska@yahoo.comAn Alternative View to the Tax Evasion: The Effect of Tax Morale on Paying Taxes in Macedonia andEU CountriesThe tax noncompliance reduces government’s revenues and hence negatively affects citizens’ lifethrough an inadequate provision of public services. In order to tackle tax evasion, governments usuallyrely on enforcement matters applying higher penalties and/or increasing the frequency of audits. On theother hand, in the last couple of years there is a growing literature and evidence suggesting thatenforcement efforts alone cannot achieve significant increase on tax compliance. This literature links thewillingness of citizens to pay taxes with the social values and norms, i.e. to the tax morale (Torgler 2005;Frey and Torgler 2007; Alm and Torgler 2006; Alm et al., 2011). If correct, the optimal governmentpolicies to tackle the tax evasion might defer considerably from the common ones. The aim of this studyis therefore to investigate factors that shape the tax morale of Macedonian citizens, and to provide acomparative assessment with the EU countries. Our empirical investigation is based on the work ofTorgler, through estimating an ordered probit model in which the dependent variable is the tax morale,and is regressed on a number of independent variables, age, gender, marital status, education, nationalpride, trust in institutions, happiness, life satisfaction, etc. Data for our study are from the fourth wave(2008) of the European Values Survey. Our main fining is that contrary to other studies for the Europeancountries, the non-demographic factors are more important factors influencing tax morale in Macedoniathan the demographic ones. The main contribution of this study is that it is the first attempt in ourknowledge to investigate the factors driving the tax morale in Macedonia.Keywords: tax morale, tax evasion, social values and norms, European Values Survey, ordered probitBiographyMaja Ristovska, MBA cand. is a member of the Laboratory for Labor Market and Social Policy Analysis, atthe University American College-Skopje. She has attended several seminars and trainings in social safetynets area, social protection economics, impact evaluation. She has been working on several projectswith the World Bank for the reforms of the social protection system, pension system and introduction ofmandatory and voluntary pension insurance, and introduction of cash transfers conditioned onsecondary education attainment for children of social financial assistance beneficiaries.Dr. Mojsoska Blazevski is Dean of the School of Business Economics and Management at the UniversityAmerican College-Skopje (UACS), as well as a professor of economics and research methods. During hercareer, Mojsoska-Blazevski attended several seminars and trainings, in macroeconomic diagnosis,forecasting methods, impact evaluation, labor economics, etc. Mojsoska-Blazevski has published andpresented several articles and reports in economic journals and conferences, mainly in the area ofmacroeconomics, labor market, education and social system and policy in Macedonia and transitioncountries. She has been working on several projects with World Bank, UNDP, EC, etc. She is advisor tothe Minister of labor and social policy, member of the Management Board of the Association forEconomic Research, Economic Policymaking and Advocacy, as well as a member of the Council of theMacedonian Development Foundation for Entrepreneurship.