DOES TAX AMNESTY INFLUENCE INTENTION TO COMPLY?: IF STUDENTS ARE TAXPAYERS ALREADY

Theresia Woro Damayanti,Pambayun Kinasih Yekti Nastiti,Supramono Supramono

doi:10.3846/bme.2020.10292

Theresia Woro Damayanti, Pambayun Kinasih Yekti Nastiti + Show 1 more

Open Access

https://doi.org/10.3846/bme.2020.10292

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Abstract

Purpose – The implementation of the tax amnesty program in Indonesia is expected to increase the intention to comply. However, the effectiveness of the program is likely to depend on the intention of taxpayer compliance. The purpose of this study is to examine differences in the intention of taxpayer compliance based on perceived justice and the taxpayer’s attitude of the government. Research methodology – Primary data was obtained through experimental research involving 117 students who were enrolled in the taxation class. To ensure that participants understand their role as taxpayers in an experiment, a role test is performed and this also acts as a test of internal validity. Findings – The results showed that there was a difference in the intention to comply based on perceived justice over the implementation of tax amnesty and taxpayers’ attitudes of government. Further analysis indicated that if taxpayers feel justice and have a positive attitude towards the government, it will lead to the highest intention to comply. Research limitations – The relationship between the justice variable on tax amnesty and the intention to comply is also possibly influenced by the existence of other variables such as feelings of disappointment. Therefore, in the future, it is necessary to do a study involving feelings of distress as a moderating variable in the relationship between justice and tax amnesty to comply. Practical implications – The government should continue to improve the performance and taxation system in order to create a positive attitude among taxpayers so that they will eventually comply with their tax obligations. Originality/Value – There are no previous studies that examined the interaction effect between the perceived justice of tax amnesty and taxpayer’s attitudes towards the government on intentions to comply.

Highlights

The issue of factors affecting tax compliance has attracted many researchers
The differences in the intention to comply with justice in the implementation of tax amnesties could be determined by comparing the scores of intentions to abide by those who feel justice and who feel injustice
This study presents whether the tax amnesty policy is able to increase tax compliance intentions from the perspective of students who will later become taxpayers

Summary

Introduction

The issue of factors affecting tax compliance has attracted many researchers. Several studies have discovered factors affecting taxpayers’ agreement, which includes income levels, tax rates, audit possibilities (Alm et al, 1992). Other factors such as respectful treatment of tax offices (Feld & Frey, 2007), taxpayer attitudes towards taxation systems affect taxpayers’ compliance It is influenced by the attitude of taxpayers for treatments by tax authorities (Misu, 2011), tax knowledge, educational level, and social groups (Engida & Baisa, 2014). Factors such as government attitudes (Damayanti et al, 2015) and equity perceived in tax amnesty influence taxpayers’ compliance (Gerger, 2012; Rechberger et al, 2010). Injustice from the implementation of tax amnesty could lead to taxpayer disappointment and in turn, will be able to affect the level of taxpayer compliance

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