The Effect of Legal and Social Factors on the Increase of Tax Evasion – Case of Jordan

Abstract

The study aimed at identifying the impact of legal and social factors on the increase of tax evasion in Jordan. The researchers have applied the descriptive approach for the theoretical framework, and the analytical approach for testing the study’s hypotheses to achieve the objective of the study. A questionnaire has been developed and distributed over a random sample of the study’s population composed of the sales and income tax auditors. (75) Questionnaires were distributed, (72) were retrieved and (2) were excluded; that is (93.3%) of the distributed questionnaires. results revealed that there are a positive relationship between Legal factors (the lack of corporate governance, The lack of severity of penal system, The lack of clarity of law provisions and their gaps), and social factors (The lack of taxpayer’s loyalty to the state, The unjust of tax system , The societies admirable view for evaders) and increase the cases of tax evasion. Therefore, the study recommended reviewing tax legislations, and emphasizing the commitment to corporate governance to reduce tax evasion.