Cooperative Compliance, Tax Control Frameworks and Perceived Certainty About the Tax Position in Large Organisations

Sjoerd Goslinga, Maarten Siglé, Robbert Veldhuizen


In recent years, a growing number of tax authorities have shifted their strategies towards large organisations to include forms of so-called cooperative compliance programmes (OECD, 2013). These programmes require large organisations to have internal (or tax) control frameworks in place that assure that they can comply with their tax obligations and can also detect uncertain tax positions and disclose these to the tax authority. In exchange, the tax authority sees to it that tax matters are resolved quickly, quietly, fairly and with finality (OECD, 2007). Cooperative compliance programmes have therefore been characterised as “transparency in exchange for certainty” (OECD, 2013, p. 28).


In this paper, we discuss two studies which examine whether the need for certainty about tax matters is indeed an important driver behind large organisations developing and implementing tax control frameworks, and whether having a tax control framework of higher quality in place increases perceived certainty about the tax position. Both Study I (n=669) and Study II (n=271) use data from a (web) survey of representatives of large organisations in the Netherlands. The results show that the need for certainty and the importance attached to tax compliance have positive effects on the quality of an internal tax control framework. Moreover, both studies find the quality of a tax control framework has a positive effect on perceived certainty about the tax position. These positive associations indicate that large organisations’ need for certainty about their tax positions stimulates them to improve their tax control frameworks in order to acquire such certainty. 


Keywords: Tax compliance, Cooperative compliance, Tax certainty, Tax control framework

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