A Study Of Tax Behavior Base On Asymmetric Information

Information asymmetry is a widespread phenomenon. One side who attends the economic transaction has information superiority. It may distract from exclusive equilibrium price, thus obtaining more additional benefit. Information superiority can bring information dividend has become the objective reality. Only A few participants really have the advantage of information resources. But many participants claim to have absolute useful information. It brings huge impact to the traditional trading rules. Research shows that the true or false of agents with private information can identify through institution design, for example, the way of the principal-agent. But it can produce adverse selection and moral risk. According to the mechanisms of the incentive and the mechanisms of the restraint, it can be resolved by designing appropriate contracts. And the game process is very complex. The taxation also exist the interest game due to information asymmetry. This article is based on the information asymmetry theory. The participants of the game include state organs, government departments, taxation department and taxpayer. It analyzed the taxation by using the principal-agent and the information game from the perspective of behavioral psychology and social behavior. Then, it explained the complex tax phenomenon and trends. At last, it put forward some suggestions for the tax governance.Chapter one is introduction. This chapter introduced the research background, basic conception and the research status. It also put forward the subject, the research thoughts, analysis path, research methods, the possible contribution and the shortage.Chapter two is atheoretical framework:the principal-agent.It mainly defined the connotation of the formation of agency relationship and oncoming problems of adverse selection and moral risk.To solve shese problems,it needed to design the incentive mechanism.The core of the mechanism is to share the risk and the output.And the angency contract is consistent with the requirements.In order to be with the principal-agent theory,it also introduced the game theory.Chapter three is the information asymmetry analysis of tax legislation and tax revenue sharing. This chapter focused on the tax legislation and tax revenue sharing. And it mainly analyzed the interest game of taxation behavior of the government, especially between the central government and the local government.On the aspect of tax legislation, the authorities should be belong to the National People’s Congress. But the exclusive legislation right partially transfers to the state council due to the information inferiority of the National People’s Congress. The state council perfects the tax laws and regulations. At the same, the state council has the information inferiority of tax operation. The functions of regulations partially transfers to the finance Ministry, the State Taxation Administration etc. The local taxation bureau also promulgates many tax regulations. It has the more substantial influence on the taxation behavior. Different levels of tax laws have impact on our country’s taxation behavior. It determined by the information asymmetry. This way can satisfy the interests of the participants of information inferiority and build the tax system in a short period. But it also produces many problems, for example, the low level tax laws, the powerful trend of maintaining the interests of the government and tax bureau etc. Current tax laws are replaced by the departmental rules which formulated by the local government and tax bureau. So it produces confliction of tax regulations, damages the tax justice, etc. These damages mainly belong to the adverse selection problems of the agent. It can’t damage the interest of the principal, but the source and reasonable of legislative power of taxation should be doubted. It affects the interest and enthusiasm of the taxpayer.In the aspect of the tax revenue sharing, the central government divides the part of tax as local government revenue due to the classified fiscal system. The taxpayer scatters over the country. The local government occupies the details of tax status. Then, it will produce many problems, for example, hidden action in the process of tax warehousing and defining the tax base. The adverse selection should damage the interests of the central government. But the principal has the rights for modifying contracts. On one hand, the central government would obtain the additional benefit due to the centralized management. At the other hand, because the central government is the last responsible role of government management, it will act as the big pig during the process of Boxed Pigs Game and think about the difficulties of local governments. At last, it wants to attain the relative coordination in the tax revenue sharing between the central government and the local government.Chapter four is the information asymmetry analysis of tax collection process. It primarily studied the taxation behavior of the tax bureau. The information distribution of tax information systems has the function of implementing tax activities and securing taxation. The lower government has information inferiority, the senior government has more information superiority. So, the tax bureau has the trend to exaggerate taxation difficulties and taxation performance. The upper tax bureau can get more sufficient safeguard. The tax staff obtains illegitimate interests by using information superiority, for example, profit rent during the link of tax activities. The base tax staff also shows the adverse selection. When facing tasks and difficulties, they will be lazy and avoiding. These problems are the results of using information superiority. But it is caused by the moral decay and the low quality. Though game tree, it can intuitively interpret the decisive influence caused by the information asymmetry, social behavior and psychology.Chapter five is the information asymmetry analysis of tax payment process. It mainly analyzed the tax behavior. The taxpayer has the superiority for its transaction information. The phenomena of hiding information are that they brag about their economic capabilities. When they face the tax bureau, they always are poor and provide useless information for influencing tax activities. The phenomena of adverse selection are that they plan tax payment places and avoid strict tax management, etc. It is also called the grey tax compliance. Hiding activities have many forms, for example, tax evasion, tax fraud, seeking illegal tax benefits, escaping taxation management, etc. It also reflects that social psychology influences the specific tax selection. The success of tax evasion and tax fraud is not caused by high skills. It is the result that the taxpayer uses a same skill on different tax person. Game matrix specifically analyzes the probability of tax evasion event and the effects of social cognition.In addition, this chapter also discussed international taxation activities. The difficulties of national tax coordination, transformation of capital and wealth, tax havens are the phenomena of information asymmetry. Because of the role of the developed country which formulates tax regulations, the developing country need afford unusually heavy information costs, including the government and the taxpayer. Now, our country has phenomena of capital flight. It is caused by uncertain information.Chapter six is the suggestion for resolving information asymmetry problems in the tax process. It put forward many specific recommendations. Of course, the phenomenon of information asymmetry could not exterminate. The realistic choice is tolerant of these phenomena. But it needs try our best to control the negative effect. The thoughts are signal display and shaping the reputation. The former is based on the orientation of social behavior. And the key of the latter is using social and psychological effects. At the same time, it also put forward five preliminary approaches. Firstly, facing the rapid development of amount of information, it need to improve automation level of the information process, improve accuracy and processing efficiency of information transmission, obtaining, analysis and feedback by technological means. Meanwhile, the informatization should be implemented in three aspects of the government, taxation process and taxpayer business processing. And it should issue regulations to assure the equivalence of information for occupies and sharing. Secondly, it increases the disclosure of asymmetric information required by the public and the media and makes the private information be public in a legal and moral way. Thereby, it can reduce contingent profits for private information made or kept by the agent. So, it assured the tax justice. Thirdly, it is necessary to invite the third-party professional strength to participate in the tax behavior and maintains the objective and fair position. It can standard the tax law and make the economic behavior healthy and orderly. Fourthly, it should adopt the way of guarantee and vertical integration for the big amount of taxpayers and the serious endogenous breeding information. Through reducing the amount of taxpayers, it can make important tax behavior enter into processing procedures. It also can significantly save resources of the tax agent and the taxpayer, reduce the amount of second information formation, and overcome information rent. At last, it should pay attention to tax legalization and the function of market mechanism. It is the most fundamental and the most important. The effects of the development of economic society on tax behavior can not be predicted. The information is objective. The different of person’s standpoint and motives can make the information asymmetry be negative. It can be resolved by tax regulations. Through these basic rules, the information asymmetry can not be common. Because the invisible market hand and the legalization can quickly squeeze the profit space of information asymmetry.This chapter is the last section. And it also put forward four specific suggestions for the above phenomena and problems. At first, it should pay attention to the seriousness of tax legislation. The National People’s Congress should formulate and promulgate all reasonable tax laws and regulations as soon as possible, reduce the phenomena of delegated legislation greatly, and regulate normally the implementation of tax laws and regulations. For the tax sharing, it needs to normalize budgeting of governments at all levels in order to ensure property rights and the power matching. It also needs to transfer the tax system mainly from turnover tax to property tax to narrow the coverage of the tax objects and reduce the economic effects of tax. Secondly, for the taxation participant, it needs to straighten out the function of taxation. And the tax system should realize the transformation from enforcing tax laws and completing tax revenue to servicing the public. Then, it needs to reduce tax bureau and the tax staff to realize the government department integration pattern. Thirdly, in order to resolve problems of taxation, it needs to change the compulsory intrusive tax management, advocate the taxpayer autonomous and make the taxpayer take part in government affairs and related tax matters. At last, in the aspect of international tax, on one hand need to strengthen tax sovereignty consciousness, regulate the tax of international capital flows, related transaction, and virtual economy, etc. In addition, it needs to adjust the export tax refund policy. On the other hand, it needs to protect economic activities in foreign and maintain economic freedom. In a word, taxation is the fundamental backing of a stronger country.