Tax Law Affecting the Tax Compliance of Online Business Individuals: A Case Study in Vietnam

Abstract

Objective: The paper's primary purpose is to find out various factors affecting the tax compliance of online businesses in the digital economy of Vietnam and propose some policy recommendations to improve tax compliance in the coming time. Method: In this study, two research methods were used: qualitative research and quantitative research following: (1) The author discussed the proposed research model with 11 managers related to the tax and consulted experts working in the tax agencies. (2) This article surveyed data from 700 persons related to online business in five big cities in Vietnam. The article used structural equation modeling (SEM) and SPSS 20.0, Amos software. Results: The paper finds five critical factors affecting the tax compliance of the online business individual with a significance level of 0.01, and all hypotheses are accepted. The article's novelty is to explore the tax service quality factor that has the most substantial impact on the tax compliance of online business individuals. Conclusions: The study's value proposed tax service quality recommendations to support online businesses to overcome difficulties caused by using different digital technologies to carry out various economic activities. The context also poses a requirement for tax authorities to work towards digitizing the tax collection process to effectively monitor and check the taxpayer's tax compliance process and ensure tax collection from the taxpayer based on digital transactions, but along with it comes many challenges for tax authorities in formulating policies and managing financial resources.