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Abstract
t This research was conducted to examine and determine the factors that influence taxpayer compliance with risk preference as a moderating variable. The independent variable used in this study is understanding of taxation regulations, tax sanctions, and tax rates. The population in this study was 1,613,317 taxpayers registered at SAMSAT Bekasi City. Sampling was done using the Accidental Sampling method on taxpayers registered at SAMSAT Bekasi City which produced 99 samples. The data analysis technique used is Structural Equation Modeling (SEM) using the Partial Least Square application with a significance level of 5%. The results of this study indicate that understanding of tax regulations, tax sanctions, and tax rates has a significant effect on the level of compliance of taxpayers, risk preference does not significantly influence the relationship between understanding of tax regulations on tax compliance levels and risk preference has a significant effect on the relationship between tax sanctions with taxpayer compliance level.
Highlights
Tax is compulsory contributions paid by the people to a country which useful for the benefit of government and society because tax is state revenue that will be used for the construction of public facilities
The lowest value in the Composite Reliability value is 0.821 for the variable understanding of tax regulations so it can be concluded that all variables in this study have good reliability of each construct and Cronbach’s value Alpha for the lowest is 0.607 at the tax rate so it can concluded that all variables in this study had a reliability good for each construct
R2 test results tax compliance is equal to 0.612 indicating that the variable is latent independent namely understanding tax regulations, tax sanctions, tax rates, and moderation variables is risk preferences, can explain latent variables dependent: taxpayer compliance of 61.2% and the remaining 38.8% explained by other factors outside this research such as socialization taxation, taxpayer awareness, and others
Summary
Tax is compulsory contributions paid by the people to a country which useful for the benefit of government and society because tax is state revenue that will be used for the construction of public facilities. State revenue in 2018 amounted to Rp1,942.3 trillion or 102.5% with the tax ratio reaches 11.5% of the increased Gross Domestic Product (GDP) by 0.8% from 2017 (Kemenkeu, 2019). To be equal to developing countries, Indonesia needs to have a tax ratio of 20% of GDP. To achieve this target the government seeks to reform taxation in various ways, one of which is building tax compliance and awareness. To achieve this target the government seeks to reform taxation in various ways, one of which is building tax compliance and awareness. level of compliance Indonesian people in paying taxes are still very low compared to other countries, as a comparison of the tax ratio in Malaysia of 16%, the Philippines 14%, Thailand 17%, South Korea 25%, South Africa 27%, and Brazil 34% (Detik Finance, 2018)
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