| Abstract: | This study examines the roles that justice and shame management play in deterring escalation in tax evasion. Data were taken from the Graduates' Hopes, Visions and Actions Survey based on a sample of 447 Australian graduates who recently received their tertiary degrees. Path analysis reveals that both justice variables (societal and personal) indirectly affect tax non‐compliance through shame (or lack thereof). Injustice brings about a significant increase in unacknowledged shame which, in turn, leads to increased tax evasion. The path to tax evasion is also mediated by an attitude condoning non‐compliance, and dissociation. Of considerable interest is the finding that personal injustice, in contrast to societal injustice, has a direct link to tax evasion. The results of the study demonstrate that felt injustice triggers both emotional and cognitive responsiveness, and works to undermine moral obligation in tax compliance. |
