Small-Business Participation in the Informal Sector of an Emerging Economy.

We investigate the characteristics of the owners of small businesses that participate in the informal sector of an emerging economy and their perception of the risk of detection by tax authorities while doing so. Data are gathered from a survey covering 1027 small businesses in Trinidad and Tobago....

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Publicado en:Journal of Development Studies Vol. 44; no. 10; pp. 1531 - 1554
Autores principales: Sookram, Sandra, Watson, PatrickKent
Formato: Artículo
Publicado: Taylor & Francis Ltd Nov2008
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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          Sookram, Sandra
          Watson, PatrickKent
        affil: University of the West Indies, Trinidad and Tobago
      su:
        Tax laws
        Taxation of small businesses
        Informal sector
        Tax evasion
        Surveys
        Developing countries
        Trinidad & Tobago
      sug:
        subj:
          Trinidad & Tobago
          Tax laws
          Taxation of small businesses
          Informal sector
          Tax evasion
          Surveys
          Developing countries
      ab: We investigate the characteristics of the owners of small businesses that participate in the informal sector of an emerging economy and their perception of the risk of detection by tax authorities while doing so. Data are gathered from a survey covering 1027 small businesses in Trinidad and Tobago. Results suggest that small business owners are motivated to participate in the informal sector when they believe that the risk of detection by the tax authorities is low and that government regulations are burdensome, but there is no evidence that the tax rate itself is an issue. Their perception of the risk of detection by the tax authority is determined largely by the time they spend and the income they earn in the formal sector.
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