Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/263797 
Year of Publication: 
2022
Series/Report no.: 
CESifo Working Paper No. 9867
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
Experimental and empirical findings suggest that non-pecuniary motivations play a significant role as determinants of taxpayers' decision to comply with the tax authority and shape their perceptions and assessment of the tax code. By contrast, the canonical optimal income taxation model focuses on material sanctions as the primary motive for compliance. In this paper, I show how taxpayers equipped with evolutionary Kantian preferences can account for both these non-pecuniary and material motivations. I build a general model of income taxation in the presence of a public good, which agents value morally, and solve for the optimal linear and non-linear taxation problems.
JEL: 
H21
H41
D91
Document Type: 
Working Paper
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