This case study provides a theoretical framework to study determinants of tax evasion, and in particular addresses two research questions: RQ1: What are the determinants of tax evasion of Bangladesh? and RQ2: How do the interests of state actors influence tax evasion? Tax evasion in developing countries is widespread. However, little attention has been paid to tax evasion in developing countries. The study focused on a developing country with reference to Bangladesh. This is because Bangladesh exhibits one of the smallest tax to GDP ratios in the world. Using quantitative and qualitative interviews, this paper sheds light on the impact of state actor(s) role on tax evasion over the period 1981–2014. The state actor(s) failed to institutionalize the norms due to political influence. Results provide evidence that lack of enforcement increases tax evasion. The paper provides a theoretical framework to study determinants of tax evasion.
Political influence and tax evasion in Bangladesh
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