Tax Advisors and Tax Aggressiveness: A Bargaining Model

Ramy Elitzur, Varda Yaari

Research output: Contribution to journalArticlepeer-review


We study the bargaining game between a tax agency and a tax advisor-taxpayer team. Specifically, we focus on the factors that motivate tax aggressiveness, and the role of tax advisors in tax aggressiveness. We begin by characterizing the conditions under which tax advisors would give aggressive advice to their clients. Next, we analyze the optimal number of bargaining rounds for the tax agency. Third, we study the counteroffers that the tax agency makes in each round of the bargaining game. In addition, we investigate the conditions under which a high-tax taxpayer type would hire a reputable tax adviser. Last, we analyze when would the taxpayer accept or reject the tax advisor’s recommendation.

Original languageEnglish
JournalJournal of Accounting, Auditing and Finance
StateAccepted/In press - 1 Jan 2021
Externally publishedYes


  • incomplete-information bargaining games
  • tax advisors
  • tax aggressiveness
  • tax uncertainty

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics, Econometrics and Finance (miscellaneous)


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