Abstract
In Malaysia, the indirect tax environment is evolving fast, and the risk has never been higher. The public perception of Sales and Service Tax (SST) as a business cost aggravates the increase in essential needs prices. Hence, the heavy burden on Malaysians’ income, which ultimately constitutes a big worry and outcry, makes the study relevant. The study investigates the relationship between selected causes of equity and fairness (tax fairness), certainty (tax burden), accountability to taxpayers, tax knowledge, and public acceptance of SST implementation in Malaysia. Data were collected through a structured survey among the public in Klang Valley. Respondents were chosen randomly from various locations in public and private sector organizations. A total of 177 out of the 228 completed and received questionnaires are found suitable for further analysis. The study adopts the SmartPLS version 3.3.2 statistical analysis tool to test the four hypotheses formulated. The study results reveal tax fairness, tax burden, and government accountability are significant and positively relate to public acceptance of SST implementation in Malaysia. This further buttressed that tax fairness, tax burden, and government accountability are critical for public acceptance of SST implementation because of their economic implications. In contrast, tax knowledge is not significant and negatively relates to public acceptance of SST implementation. The effect indicates that tax knowledge is not an essential factor as far as public acceptance of SST implementation is concerned in Malaysia.
Highlights
In Malaysia, public opinion, environment and the law matter to the government in decision making
From the perspective of indirect This study aims to: tax implementation in Malaysia, the public consumption pattern should not be trapped by Sales and Service Tax (SST). a) investigate the relationship between the tax fairness factor and the public acceptance of
The study hypothesis H3 states that tax fairness In the study, hypothesis H4 predicts that govis positively significant to public acceptance to- ernment accountability is positively significant wards SST implementation in Malaysia
Summary
In Malaysia, public opinion, environment and the law matter to the government in decision making. This research aims to Asmuni et al (2017) argue that the survivability integrate selected factors that affect the public ac- aspect of indirect tax, SST, depends on public acceptance of SST implementation in Malaysia. Justice services, education, transportation, and Several researchers such as Saad (2011), Farrar medical Their studies emphasized that the public (2011), and Palil (2010) empirically confirm the is entitled to a clear justification for the imposed influence of tax knowledge on compliance betaxes. Anggoro (2018) and AICPA Tax Division (2017) argue that the principle of neutrality prohibits the discouragement of taxpayers from work-
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