In this VoxDev talks, Tim Besley of LSE talks about how some states, like the Nordics, can enjoy higher rates of taxation and still get compliance, whereas others might not be able to attain either.

He attributes the ability to tax as a cultural phenomenon that can be changed over time: as people feel that their tax dollars are going to things they find useful, they become more willing to pay their taxes. Over time, this leads to better rates of compliance.

 

One conclusion, then, is that government officials wanting to increase tax compliance would do well to spare some funds for the types of goods which people can see as being effective uses of their tax dollars, including public goods like roads and schools.