The Influence of Love of Money, Machiavellianism, and Injunctive Norms on Tax Evasion with Religiosity as Moderating Variable

Abstract

Taxes form 85% of Indonesia's state budget revenues. Based on the importance of tax discipline, the government has implemented various tax reforms to increase tax revenue targets. However, many taxpayers try to find loopholes to avoid paying part of their taxes. The purpose of the study is to assess the influence of love of money, machiavellianism, and injunctive norms on tax evasion with religiosity as moderating variable. The object of the study is 100 taxpayers served by the North Makassar Primary Tax Service Office and South Makassar Primary Tax Service Office. The criterion for choosing taxpayers is the size of the annual income of more than 60 million rupees. Data were collected using questionnaires with a Likert scale. Love of money variable is measured by the money ethics scale (MES) developed by Tang (2002) using 4 indicators. The machiavellianism variable is measured by the 7-item Mach IV scale, which is adapted from Christie's (1970) indicator. The variable of injunctive norms is measured by the indicators developed by Bobek et al. (2013). The religiosity variable was measured using indicators developed by Glock and Stark (1965). The tax evasion variable was measured by 5 indicators with 7 statements developed by Suminarsasi and Supriyadi (2011). The partial least square (PLS) method was used for data analysis. The study’s results showed that love of money and machiavellianism have a positive and significant influence on tax evasion. In contrast, injunctive norms negatively and significantly influence tax evasion. At the same time, religiosity moderates the impact of these factors on tax evasion. This suggests that high love of money, manipulative nature and willingness to adapt to the environment are why taxpayers cheat on their tax obligations. Still, taxpayers' religiosity can be a deterrent factor to tax evasion.