Tax Behavior as a Criterion for Differentiating the Territories for the Purposes of Preventing Tax Violations and Influencing the Level of Tax Culture

Kataeva Vasilina Andreevna Student of Finance, Credit and Exchange Department, Perm State University 614990, Russia, Perm Krai, Perm, Bukireva str., 15 vasil.cataeva2016@yandex.ru

Goleva Ol'ga Ivanovna ORCID: 0000-0002-0846-4913 PhD in Economics Associate professor of Finance, Credit and Exchange Department, Perm State University 614990, Russia, Perm Krai, Perm, Bukireva str., 15 OlgaGoleva@psu.ru Other publications by this author

IntroductionThe topic of improving financial literacy and the formation of financial culture of the population has been given much attention in recent years, a large number of programs, events and projects are being implemented, both at the federal and regional levels.

Tax literacy and tax culture are important components of financial literacy and financial culture. Tax offenses are most often associated either with fraudulent actions, or with a low level of knowledge of tax legislation and failure to accept obligations by taxpayers.

Taxes are the main type of state budget revenues. They ensure the implementation of the domestic and foreign policy of the state by redistributing the funds of society, both in favor of the state and among the population.  The level of tax literacy as a component of financial literacy of the population directly affects the conscious behavior of taxpayers and willingness to pay taxes and, as a result, the effectiveness of tax administration and increase in tax collection, which is demonstrated in a number of foreign ^{[1, 2, 3, etc.]} and domestic studies ^{[4, 5, 6, 7, etc.]}. Tax literacy is the level of knowledge of legislation by the population, their application in practice. This concept is the basis for the formation of the tax culture of the population, which includes not only knowledge and skills, but also moral and ethical qualities, the formation of a system of values and norms among citizens. A high level of tax culture ensures a reduction in the number of tax evasion, illegal schemes to minimize tax payments and the shadow sector of the economy. The formation of a tax culture ensures the improvement of the quality of the tax system, on which the functioning of the state and the level of development of the country depend. Tax literacy, among other things, is a priority in the work of tax authorities.

Within the framework of the "Strategy for Improving Financial Literacy in the Russian Federation for 2017-2023" developed by the Government of the Russian Federation, measures aimed at forming a positive attitude to the tax policy of the state are being actively carried out in order to form an understanding among the population of the importance of paying taxes and increasing confidence in the tax system of the Russian Federation. However, these activities and developments are quite often aimed either at the generation of people who have not yet paid taxes, or at people who are interested and understand the importance of paying taxes. Therefore, in order to maximize the effectiveness of increasing the tax culture, financial resources should be concentrated on developing a systematic approach for other categories of the population as well.

The relevance of the study lies in the need for a priority impact on the tax culture of the population that has arrears in payment, i.e. on the category of citizens most at risk. As part of the risk-based approach, it is necessary to identify the territories on which to focus in conditions of limited resources.

Based on the assessment of overdue tax debts of the population, it is possible to implement a differentiated approach of influencing the level of tax culture of the population. This will increase the effectiveness of the proposed measures to increase tax culture.

The purpose of this work is to develop a mechanism for identifying the differentiation of territories of a subject of the Russian Federation based on the analysis of overdue tax debts according to judicial acts for the purposes of planning and organizing effective prevention of tax violations and increasing the level of tax culture.

Research objectives:

1. identify the target audiences of implemented measures aimed at improving tax culture (financial literacy);

2. substantiate the list of indicators and the structure of data characterizing the differentiation of territories;

3. to develop and test a mechanism for assessing the level of differentiation of the territories of the subject of the Russian Federation for the prevention of tax violations.

The object of the study is the population of a separate subject of the Russian Federation. In this paper – the population of the Perm region. The subject of the study is overdue tax arrears as a manifestation of the tax behavior of the population.

Research methodology. The task of considering the available approaches to improving the level of tax culture and preventing tax violations was solved by analyzing the literature, regulatory and methodological base of the tax service and financial authorities. As part of the development of a differentiated approach, an analysis of regulatory documents and a content analysis of the statistical database of court decisions based on Article 48 of the Tax Code of the Russian Federation for 2019-2021 was carried out. With the help of graphical analysis, the development of the map by QGIS technologies using the Jenks method of classification of natural gaps, a cluster analysis of territories was carried out and municipalities were identified whose tax culture of the population should be primarily affected.

In the course of the work, the existing measures aimed at improving the level of tax culture of the population were considered. At the moment, special attention is paid to improving the financial literacy of schoolchildren and students. The systematic approach of influencing this category is the development and implementation of a financial literacy program in Federal State Educational standards. The program was adopted in July 2021. Training under the new programs within the framework of the new Federal State Educational Standard of NOO and the Federal State Educational Standard of LLC begins on September 1, 2022 (Order of the Ministry of Education of the Russian Federation No. 287 dated May 31, 2021 "On Approval of the Federal State Educational Standard of basic General Education").

To assess and improve knowledge in the field of taxes and taxation, the All-Russian Tax Dictation is held annually (https://diktant.rnk.ru /). Within the framework of the "Strategy for Improving Financial Literacy in the Russian Federation for 2017-2023" developed by the Government of the Russian Federation, information work is being carried out with citizens. For example, in autumn on public transport you can hear a reminder about the need to pay property taxes. Also, starting from 2018, in each subject of the Russian Federation, territorial tax authorities conduct public informing of taxpayers in the form of face-to-face meetings ("Schedules of public informing of taxpayers" www.nalog.gov.ru/rn59/about_fts/seminars_plans /). However, these measures are aimed either at schoolchildren and students, or the category of taxpayers interested in improving tax literacy. If in the first case a systematic approach has been developed (educational standards include relevant competencies), then for the adult population, measures to increase the level of tax culture are not systematic and are not divided by target audiences. As part of the days of financial and/or tax literacy, open lectures, hotlines, consultations are held, which implies proactive behavior on the part of a person and interest (examples of events: report on the results of the implementation of the departmental plan of the Federal Tax Service Administration in Moscow for the implementation of the Concept of Openness of federal executive authorities in 2020 https://www.nalog.gov.ru/html/sites/www.rn77.nalog.ru/otchetvedplan2021.docx , Increase of tax and financial literacy of the population is a priority in the work of tax authorities https://www.nalog.gov.ru/rn53/news/activities_fts/8777718 /, "Tax Literacy: what is important for everyone to know" https://www.nalog.gov.ru/rn11/news/activities_fts/10297835 Thus, when implementing measures aimed at improving the tax culture, the level of risk of the target audience is not taken into account.

Mechanism for identifying areas of influence on the level of tax culture of individuals for the purposes of a risk-based approach to the prevention of tax violations Much attention of researchers of the financial and tax culture of the population is paid to certain factors that affect the tax culture and the propensity to violate tax legislation (gender, age, political preferences, etc. are studied). Issues of territorial differentiation in tax culture were considered mainly at the level of cultural characteristics of countries and national traditions ^{[7, 8, 9, etc.]}.

               Attempts to take into account spatial effects and other forms of differentiation in the context of tax culture and literacy across the territories of the Russian Federation were also made by domestic authors ^{[11, 12, 13]}. So Nagapetyan A.R., Bonyachuk M.V., Grigorieva V. ^[14] come to the conclusion that the propensity to violate tax legislation depends on a similar indicator in neighboring regions. The works of a number of Russian authors indicate the need to work on improving tax literacy in certain regions and territories, including remote ones, using information and communication technologies ^{[15, 16]}. It is worth noting that territorial differentiation in matters of tax culture and tax behavior is considered by researchers in the context of the subjects of the Russian Federation, which does not provide information about the situation in individual territories of the region.

Within the framework of this study, a mechanism has been developed to assess the level of differentiation of territories in order to further increase the tax culture of individuals. This methodology is based on three components: the aspect of tax culture, territory, and target audience. These elements make it possible to identify the category of the population for which a separate system of events should be developed and implemented, the territory on which to focus primarily, subject to limited resources, and the thematic basis of the events.

The plan for assessing the level of differentiation of the territories of the subject of the Russian Federation for the purposes of planning and organizing effective prevention of tax violations can be presented as follows:

1. choosing a component of tax culture (knowledge, awareness/fulfillment of duties/awareness of the importance of paying taxes) and determining the topic of analysis that will allow us to conclude about the level of tax culture of the population;

2. determination of the territory (subject of the Russian Federation, municipality, etc.) for the analysis of the tax culture of the population and the subsequent impact on its level;

3. selection of the source of statistical data and the formation of an information base;

4. analysis of statistics:

4.1 identification of the target audience, the development of whose competencies within this subject area is most relevant;

4.2 identification of problematic territories of the subject, the development of the tax culture of the population of which requires priority attention;

4.3 identification of aspects of the tax culture of the population of the allocated territories that require impact;

5. development of measures aimed at improving the tax culture of the population;

6. identification of sources of financing of the proposed measures;

7. determination of ways to assess the effectiveness of the proposed measures.

An example of the application of a differentiated approachThe plan for assessing the differentiation of the territories of the region by the level of tax culture has been tested on the example of the Perm Region.

1. Choosing the component of tax culture (knowledge, awareness/fulfillment of duties/awareness of the importance of paying taxes) and determining the topic of analysis that will allow us to conclude about the level of tax culture of the populationTax culture, as already noted, is a complex and multidimensional concept.

Tax culture cannot be separated from the value orientations of a person as a whole and the current socio-economic situation (both in the economy as a whole and for an individual in particular) and cannot be conditioned by tax literacy alone. Researchers show a special (and quite utilitarian) interest in tax behavior, including deviant behavior, and the reasons for this or that type of behavior. Often in research (including those mentioned above), sociological research forms the basis of the study, which is quite effective, but expensive tools.

In conditions of limited resources (financial, labor, temporary) for improving tax literacy, it is important to focus them on the substantive part of the work, including focusing efforts in "problem" territories. Official data of court decisions can become a reliable source of information about problematic or deviant tax behavior, as an example of an extreme form of deviant tax behavior.

2. Definition of the territory (subject of the Russian Federation, municipality, etc.) for the analysis of the tax culture of the population and the subsequent impact on its levelThe need to increase the level of tax literacy and culture of the population as an element of conscious behavior of a citizen of the country dictate the need for universal coverage and systematic work in this direction, which is implemented through the implementation of projects and programs at the federal level.

At the same time, a targeted impact to adjust tax behavior on certain categories of the population of a particular territory may be necessary (and only possible in the absence of other tools to influence the behavior of an adult or the economic situation as a whole). As an example of the application of a differentiated approach, the situation of the Perm Region was considered.

3. Selection of the source of statistical data and the formation of an information baseAccording to Article 57 of the Constitution of the Russian Federation, it is the duty of every citizen to pay legally established taxes and fees.

However, there is a practice of violating this provision. In accordance with Article 48 of the Tax Code In the case of "non-fulfillment by the taxpayer of the requirement to pay taxes, fees, insurance premiums, penalties, fines, the tax authority applies to the court with an application for debt collection" (Tax Code of the Russian Federation). After that, a court order for payment is issued to the taxpayer. Based on the availability of court cases on debt collection, it is possible to judge the untimely and involuntary performance of duties by taxpayers. Consequently, the tax behavior of this category of the population may indicate a lack of understanding of the importance of paying taxes and lack of awareness, along with objective economic reasons for the impossibility of paying taxes for a particular individual, which directly affects the amount of tax revenues of the state.

To analyze the tax behavior of the population of the Perm Region, court cases for 2019-2021 were taken on the basis of Article 48 of the Tax Code of the Russian Federation from the Internet database of judicial acts, court decisions and regulatory documents of the SudAct ("Judicial and regulatory acts of the Russian Federation (SudAct): Internet database of judicial acts, court decisions and regulatory documents" URL: https://sudact.ru/). Based on a sample of 118 decisions, a statistical database was formed containing information about the municipality of the case, the tax on which the debt was formed and its volume. Table 1 shows the grouping of court cases by the territories of the Perm Region: the total amount of debt, the number of debtors, the average debt per person and the most problematic type of tax, which was highlighted as the most frequent, are reflected.

Table 1

Grouping of statistical data on the territories of the Perm Region on the basis of court decisions on cases of violation of Article 48 of the Tax Code of the Russian Federation for 2019-2021.

Data analysis and interpretation can be expanded (if necessary, and the possibilities for this). In the context of this study, a mechanism is presented for assessing the "problematic nature" of territories by extreme manifestations of opportunistic behavior of taxpayers – individuals. At the same time, it should be understood that such behavior can be a manifestation of a difficult socio-economic situation in a particular territory.

4. Analysis of statistics:4.1. Identification of the target audience, the development of whose competencies within this subject area is most relevant

Minor citizens may be recognized as taxpayers.

However, the obligation to pay passes to their parents/guardians. Thus, the category of the population that is proposed to be affected includes adult taxpayers who are in arrears in paying taxes and fees, which corresponds to a risk-oriented approach. The system of measures aimed at improving the tax culture of schoolchildren and students affects potential taxpayers. The problem of the lack of measures to influence the category of the population paying taxes and fees leads either to forced payment and, as a consequence, a negative attitude to the tax system of the Russian Federation, the activities of state authorities, or to a shortage of funds by the state budget.

4.2. Identification of problematic territories of the subject, the development of the tax culture of the population of which requires priority attentionThe data of the statistical database are grouped by the territories of the Perm Region.

It was revealed that for the period 2019-2021, individuals of 17 municipalities had arrears in the payment of taxes and fees. The largest amount of debt owed by individuals falls on the Perm region (926 thousand rubles). The lowest amount of debt in the Solikamsk district is 612 rubles . Perm District is also the leader in the number of debtors (48 court cases under Article 48 of the Tax Code of the Russian Federation), 26 people with debts are residents of the Chusovsky City District. 9 debtors are accounted for in the Nytvensky and Kudymkarsky districts, 8 – in the Gubakhinsky city district. In other municipalities of the Perm Region, the number of citizens who have tax arrears is less than or equal to 4.

Based on a sample based on previously defined criteria (the number of debtors, average debt, problematic tax/collection), a map of the tax behavior of the population of different municipalities of the Perm Region was compiled, aimed at identifying the places of the greatest relevance of the application of measures to increase tax culture (Fig. 1).

Fig.1. Graphical analysis of the differentiation of municipalities of the Perm Region by the level of overdue tax arrears of the population for 2019-2021 (according to judicial acts)

The identified territories are clustered into 5 groups according to the average debt per person. The cluster ranges were determined by the Jenks natural discontinuity classification method, designed to determine the best arrangement of values.

1. The first cluster includes territories where there were no court recoveries of tax arrears for the period 2019-2021.

2. The lowest average debt falls on Solikamsk and Krasnovishersky districts.

3. The most numerous cluster (the average debt does not reach 9 thousand rubles, which is less than the average debt in the Perm Region by more than 2 times) was formed from Bereznikovsky and Chusovsky urban districts, Kudymkarsky Yusvinsky, Uinsky, Okhansky, Bolshesosovsky districts.

4. The third cluster, characterized by an average level of risk, is Gubakhinsky and Krasnokamsky urban districts and Kungursky, Permsky, Vereshchaginsky districts. In these territories, the debt is approximately equal to the average per capita in the region (18.6 thousand rubles).

5. The highest risk group included Karagay, Ochersky and Nytvensky districts. In these territories, the average debt is several times higher than the average in the region and reaches 76 thousand rubles.

Thus, first of all, measures should be taken to increase the tax culture of individuals in the Karagay, Ochersky and Nytvensky districts, since the largest debt per debtor is traced. In addition, attention should be paid to Perm and Chusovsky districts as municipal districts with the largest number of debtors.

4.3. Identification of aspects of the tax culture of the population of the allocated territories that require impactThe analysis showed that the most problematic area of individuals in the Perm Region is the payment of transport tax.

Next, you should pay attention to the payment of insurance premiums and personal property tax. Table 1 shows the most problematic types of taxes specifically for each territory of the Perm Region. They were allocated based on the largest amount of debt and the largest number of debtors. On the map, municipalities are also classified by type of tax (Fig.1).

5. Development of measures aimed at improving the tax culture of the populationMost often, taxpayers who have tax arrears are not interested in self-education and the perception of educational information written in a complex legislative/scientific language.

Therefore, entertaining content on social networks, including an unobtrusive training part, can become a way of influencing this target audience. Content can be distributed through targeted advertising based on information trails. For example, if a person is interested in buying a car, he will often encounter information about the payment of transport tax.

               The content of the events and the form of submission and presentation of educational and informational materials will definitely require separate study and development. Methodological and substantive issues of the organization of increasing the tax literacy of the adult population are an independent subject of consideration. Thus, the system of basic competencies in the field of tax literacy is being considered and developed by scientists from different countries and provides for a detailed study of both substantive aspects and forms of reporting material and methods of forming new skills ^{[17, 18, 19, 20, etc.]}.

In addition, measures to increase the tax culture should be based on the specifics of the tax for which the greatest debt is identified. I.e., in those municipalities where the transport tax is problematic, it is possible to distribute leaflets at gas stations. In case of a problem with the payment of insurance premiums, work on improving the tax culture should be focused on employers and sole proprietors.

At the same time, it should be particularly noted that the level of tax culture and literacy is not the only factor ensuring the completeness of the payment of taxes by individuals. The difficult economic situation in certain territories can be a key and objective factor of non-payment of taxes.

6. Identification of sources of financing of the proposed measuresFinancing can be carried out at the expense of the budget of the Perm Region within the limits allocated for improving the financial literacy of the population.

Annually 5,262.5 thousand rubles are allocated for this direction of development.  The fulfillment of this limit was 100% only in 2017. In subsequent years, the development was partial, while expenses were concentrated in the 4th quarter of the year. Consequently, the activities are not systematized. In 2021, only 20% of the limits were mastered ("Information on the use of allocated budget funds by the Ministry of Finance of the Perm Region" https://mfin.permkrai.ru/dokumenty/248334/). It is worth noting here that in 2022 a Regional Center for Financial Literacy was established in the Perm Region, which is responsible for implementing a systematic approach to improving financial literacy among the adult population of the Perm Region. Thus, the proposed methodological tools can be used to improve the effectiveness of activities to improve tax literacy, as a component of financial literacy, of the population of the region.

7. Determination of ways to evaluate the effectiveness of the proposed measures

As a way to assess the effectiveness of the proposed measures aimed at improving the tax culture of the population, a repeated study of these statistics after the period of application of the proposed measures and quick surveys in social networks of the population of the allocated territories can act, allowing us to conclude about the timeliness and completeness of paying taxes and about the awareness of these actions.

ConclusionThe paper formulated and tested a mechanism for identifying territories for the purposes of priority impact on the level of tax culture of individuals in the prevention of tax violations.

The presented toolkit complements the existing set of measures aimed at improving financial literacy and increasing the level of tax culture of the population of the Russian Federation, and allows you to quickly and without significant labor costs to select the territories of the region in which extreme manifestations of deviant tax behavior are most acute, which will allow you to concentrate efforts on correcting tax behavior as a component of tax culture in problem territories.. The practical significance lies in improving the effectiveness of the supervisory activities of tax authorities. The methodology can be applied in any subject of the Russian Federation.