¿Why are we paying our taxes? Although initially studies on the analysis of taxpayers’ behavior arose in the economic field, based solely on the supposed rationality of individuals, later on other analytical approaches appeared that introduced psychological and sociological factors, considering a behavior that was more responsible than those rational theories could initially foresee.

Thus, research emerged that analyzed the not-so-rational behavior of taxpayers, contributing concepts such as Puviani’s “contributive impulse” (1903¹) which would be one of the prolegomena of what we know today as “tax morale”, first coined by Schmolders in 1962² and later expanded by Torgler (among others) with numerous investigations since 2005³. Among the various determinants associated with tax morale are those of an institutional nature, which are important for the Tax Administrations (TAs) to address within the framework of their “cooperative compliance” programs.

While there are many studies that analyze the costs of tax compliance, there are not so many studies that analyze the costs that are not monetary for taxpayers, but that have an impact on indirect or hidden costs that may go unnoticed, are probably more difficult to quantify, but undoubtedly have an enormous importance and impact when assessing their level of tax liability.

Specifically for the Spanish case, we find how this issue has been relegated from the political agenda for more than 20 years, since we found no empirical evidence since the beginning of this century through two studies conducted by the Institute of Fiscal Studies to quantify the indirect costs of compliance with Personal Income Tax in 1998 and 1999⁴. Trying to break this research gap, and together with my colleague and doctor Germán J. Arenas⁵ , we have recently published an article in the Crónica Tributaria⁶,

trying to measure the psychosocial costs of tax compliance in Spain over the last ten years. In this article, we found that tax responsibilities imply for Spanish citizens different types of cognitive and emotional costs linked to fear, worry and understanding. In addition, our analysis shows how the Spanish tax system is perceived as complex and difficult to understand for most people, although with notable differences among certain groups: retirees, women and people of “low” socioeconomic class and with less education.

It is true that the State Agency of Tax Administrations (Spain), among others, has made enormous progress in recent years to simplify and facilitate voluntary tax compliance, thus reducing some of these indirect compliance costs. However, recent studies (Choi and Jurow, 2023: 527) show how these costs have changed based on the new TA-taxpayer relationship, where the concern is no longer so much about simplification in relation to saving time, but about making a mistake (as far as the “income tax return” is concerned). In fact, the understanding and clarity of the Spanish tax system is perceived as improvable among its citizens as I show in my chapter of an interesting collective book “just out of the oven”⁸. Issues framed within clear tax communication such as simple language, or the tone of notifications are key to reducing indirect compliance costs among taxpayers.

Within the problems of tax misunderstanding, it is pertinent to ask: Do TAs have information on how indirect compliance costs may be affecting their collection levels? Do TAs explain sufficiently clearly what the tax liabilities of their taxpayers are? Do they adapt their communication strategies to the most vulnerable groups? Do they simplify their language and adapt the tone of the notifications they send? As Susntein said in 1973⁹ , simplicity is the antithesis of complexity. Making tax systems more readable increases the levels of voluntary tax compliance (Sawyer, 2016¹⁰). This is also underlined in a recent report by the World Bank (2021:8¹¹) which expresses how the understanding of tax processes, as well as the determinants that affect tax compliance are shown to be a priority and prior to the fact of paying taxes.

¹ Puviani, A. (1903). Teoria dell’illusione finanziaria. Milán: ISEDI.

² Schmölders, G. (1962). Teoría General del Impuesto. Madrid: Editorial of Financial Law. Defined as “the psychic attitude that marks the optimal limit of taxation.”

³ Torgler, B. (2005). “Tax Morale and Direct Democracy,” European Journal of Political Economy, 21, pp. 525-

531. Defined by this author as “the intrinsic willingness of taxpayers to pay taxes”.”

⁴ Working documents IEF 2/2000 y 25/2001.

⁵ As part of a joint research project of which we are a part: a project of I+D+i PID2020-114308RB- I00, financed by MCIN/ AEI/10.13039/501100011033/ – “The right to understand the tax communication. Analysis and clarification of the discourse used in collection procedures..”

⁶ Goenaga, M. y Arias, G. (2024). “Análisis longitudinal de los costes psicosociales del cumplimiento tributario en España: entre la opacidad y la incomprensión”, Crónica Tributaria “Nueva Época“, 2(191), pp. 59-75. https://dx.doi.org/10.47092/CT.24.2.2

⁷ Choi, J. H. y Jurow Kleiman, A. (2023): “Subjective Costs of Tax Compliance”, Loyola Law School, Los Angeles Legal Studies Research Paper No. 2023-05, Minnesota Law Review.

⁸ Goenaga, M. (2024). “La importancia del framing y la comunicación clara en el cumplimiento tributario voluntario”, en MONTOLIO DURAN, E. (coord.): Comunicación tributaria clara. Una aproximación interdisciplinar,

137. 119-137. Madrid: Aranzadi. ISBN digital: 978-84-1162-989-8.

⁹ Sunstenin, C.R. (1973). Simpler: the future of Government. Nueva York: Simon & Schuster.

¹⁰ Sawyer, A. (2016). “Complexity of Tax Simplification: A New Zealand Perspective,” en S. James, A. Sawyer y T. Budak (eds), The Complexity of Tax Simplification. London: Palgrave Macmillan.

¹¹https://documentos.bancomundial.org/es/publication/documents-reports/documentdetail/472181576511865338/behavioral-insights-for-tax-compliance