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Tax compliances in Korea and Japan

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  • Tax compliances in Korea and Japan
  • Hyun, Jin Kwon
  • The Association of Korean Economic Studies


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Title Tax compliances in Korea and Japan
Similar Titles
Material Type Articles
Author(English)

Hyun, Jin Kwon

Publisher

[Seoul]:The Association of Korean Economic Studies

Date 2006
Journal Title; Vol./Issue The Journal of the Korean Economy:vol. 7(no. 1)
Pages 19
Subject Country Japan(Asia and Pacific)
South Korea(Asia and Pacific)
Language English
File Type Link
Subject Economy < Financial Policy
Holding AKES

Abstract

We analyze the determinants of tax compliance, and illustrate why they have different levels of tax compliance between Korea and Japan. Japan has much higher level of policies in both tax audit and penalty structures than those of Korea. The disclosure policy of tax information is also different, such that an amount of tax evasion and the information about tax return are strictly regulated in Korea, however, they are selectively released in Japan. Tax culture may be one fundamental determinant for explaining the tax compliance. We examine its endogenous characteristic. Our estimates show that Japan has the higher level of tax culture than that of Korea. We also illustrate that the legal system is relatively more important factor to determine the level of tax culture than other branches of government, which eventually affects the level of tax compliance.