The Determinants of the Trust Climate between the Moroccan Tax Administration and Multinational Enterprises in the Transfer Pricing Domain: Empirical Research

Abstract

This paper identifies and hierarchically orders the determinants favouring the establishment of a trust climate between the Moroccan tax administration (MTA) and multinational enterprises (MNEs) in the transfer pricing domain. While tax trust has been widely studied in advanced economies, it remains underexplored in emerging economies and largely absent from the transfer pricing field in Morocco, a gap this paper addresses. A sequential explanatory mixed-methods design is employed: OLS regression on composite scores (n = 74) combined with thematic analysis of 17 semi-structured interviews processed under NVivo. The model shows high explanatory power (R² = 0.725; adjusted R² = 0.696; F(7,66) = 24.84; p < 0.001). Three determinants are validated as significant direct effects: perceived legal certainty (β = 0.564; p < 0.001), procedural efficiency (β = 0.307; p < 0.001), and quality of fiscal dialogue (β = 0.195; p = 0.018). Qualitative triangulation reclassifies the four non-validated determinants as second-order enabling conditions. These findings support a three-level hierarchical model that enriches the Slippery Slope Framework (Kirchler, Hoelzl & Wahl, 2008) by introducing a sequential hierarchy of determinants and the epistemic power asymmetry specific to transfer pricing, in an emerging post-BEPS economy. These findings should nonetheless be read with caution, given a modest sample size (n = 74), a cross-sectional design and a single-country scope.

JEL Classification: H26, H83, F23, K34, M41, M48.

Paper type: Empirical Research.