Does Political Culture Matter? Deciphering the Whys of Ukrainian Tax Compliance

Abstract

In gauging how well residents in the new post-communist states such as Ukraine become true citizens, who are capable of fulfilling their obligations to their governments, it is necessary to measure how compliant the populace is on an individuallevel with respect to taxes. While there is a lack of data on taxpayer compliance rates in Ukraine in comparison to its neighbours, results from a series of unique Taxpayer Compliance Attitudinal Surveys designed and carried out by this author in 2004 and 2005 illustrate how Poles, Russians and Ukrainians view paying their dues. The data indicates not only that the Polish polity is far more willing in its attitude towards paying taxes than the Russian and Ukrainian polities are, but that Russians respond to the state with greater fear of coercion while Ukrainians, showing the lowest levels of support for obeying the law, react to state efforts to increase tax compliance with less fear and little trust. The Ukrainian survey also provides for additional comparative analysis of those in the different regions of the country. While respondents from the four main regions of the country—East, West, Centre and South—do not differ when in comes to overall support for obeying tax laws, the rationale for doing so does differ in particular between the East and the West. Moreover, what is also striking is the difference in support for tax compliance as well as the rationale for doing so between Catholic and non-Catholic Ukrainians. The important question, then, becomes “why?” By linking issues of political culture to legacies of state-society trust, the paper shows that there is a distinct “Catholic effect,” which while not strong, shows that Catholic Ukrainians seem to react to a greater extent to state efforts to increase tax compliance more out of their levels of trust in the state than do non-Catholics. Hence, political culture is shown to have some impact in the realm of paying one’s dues to the state.