This study aims to investigate the extent to which consumers recognize participation in consumption tax evasion (CTE) as an ethical issue and the impact of moral recognition on consumer intention to participate. It also explores the role of religiosity and attitude toward government in the ethical decision-making process of consumers.
The model was tested using the structural equation modeling approach over 128 responses collected through the mail survey.
The results of the study suggest that attitude towards government and religiosity influences the consumers’ intention to participate in CTE. The negative attitude toward government enhances the intention to participate in CTE. Religiosity negatively influences the intention to participate in CTE and makes people recognize participation in CTE as a moral issue.
There is a need to explore the impact of other factors such as social norms and personality traits on the consumer decision-making to participate in CTE.
This study indicates that the even when people recognize participation in CTE as morally wrong, they do not have intentions to avoid such behavior because of their attitude toward government. Governments need to improve their image among consumers to reduce CTE. Also, there is a need to launch social marketing campaigns to move consumers from just recognizing moral issues in CTE to forming intentions to resolve those issues.
Earlier studies have explored the moral issue related to tax evasion in a context where an individual has directly participated in such an act, whereas this study explores the ethical aspect in the situation where consumers play an indirect role in tax evasion, i.e. CTE. In the context of participation in CTE, this study points out that the consumers recognize their indirect participation in CTE as a moral issue, but they lack the intention to curb such behavior. Further, no earlier study has explored the impact of religiosity and attitude toward government in such indirect participation in tax evasion.
Srivastava, H.S., Singh, G. and Mishra, A. (2018), "Factors affecting consumers’ participation in consumption tax evasion", Journal of Indian Business Research, Vol. 10 No. 3, pp. 274-290. https://doi.org/10.1108/JIBR-10-2017-0191
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