Trust and Compliance Effects of Taxpayer Identity Theft: A Moderated Mediation Analysis

This study aims to investigates the effect of the tax authorities' attitude, and the effectiveness of the taxation system on tax compliance. This study also wants to investigates the moderating role of the tax authorities' moral obligations on the effect of the tax authorities' attitudes and the effectiveness of the taxation system on taxpayer compliance. The population in this study are non-employee individual taxpayers who are registered at the Primary Tax Service Office in Pekanbaru. The sampling technique in this study used purposive sampling. To test the direct effect of the tax authorities' attitude and the effectiveness of the taxation system, multiple regression analysis was used, while to test the moderating role of the tax authorities' morale obligation, moderated regression analysis was used. The results show that the attitude of the tax authorities and the effectiveness of the taxation system affect taxpayer compliance. This study also found that the tax authorities' morale obligations moderated the effect of the tax authorities' attitude and the effectiveness of the taxation system on taxpayer compliance.

The relevance of the article is determined by the need to study the essential characteristics, formation and development of tax compliance as part of the process of improving the organization of interaction between tax authorities and taxpayers in order to determine its subordination and role function. The subject of the study is tax compliance as an element of the organization of interaction between tax authorities and taxpayers. The purpose of the work is to improve the organizational foundations of interaction between tax authorities and taxpayers. The article identifies factors that have a negative impact on the organization of interaction between tax authorities and taxpayers; examines the evolution of models for the organization of interaction between tax authorities and taxpayers; identifies key tools inherent in each model of interaction between tax authorities and taxpayers; examines and critically evaluates approaches to the concept and term «tax compliance» in Russian and foreign practice; identifies essential characteristics of tax compliance as an element of the organization of interaction between tax authorities and taxpayers. Conclusions are drawn about the need to get rid of a narrow, formal approach to taxcompliance as a function of tax risk management and substantiate its role as a systemic element accumulating external and internal impulses of socio-economic development of society and inducing appropriate reactions from taxpayers.

Both coercion, such as strict auditing and the use of fines, and legitimate procedures, such as assistance by tax authorities, are often discussed as means of enhancing tax compliance. However, the psychological mechanisms that determine the effectiveness of each strategy are not clear. Although highly relevant, there is rare empirical literature examining the effects of both strategies applied in combination. It is assumed that coercion decreases implicit trust in tax authorities, leading to the perception of a hostile antagonistic tax climate and enforced tax compliance. Conversely, it is suggested that legitimate power increases reason-based trust in the tax authorities, leading to the perception of a service climate and eventually to voluntary cooperation. The combination of both strategies is assumed to cause greater levels of intended compliance than each strategy alone. We conducted two experimental studies with convenience samples of 261 taxpayers overall. The studies describe tax authorities as having low or high coercive power (e.g., imposing lenient or severe sanctions) and/or low or high legitimate power (e.g., having nontransparent or transparent procedures). Data analyses provide supportive evidence for the assumptions regarding the impact on intended tax compliance. Coercive power did not reduce implicit trust in tax authorities; however, it had an effect on reason-based trust, interaction climate, and intended tax compliance if applied solely. When wielded in combination with legitimate power, it had no effect.

Due to the significance of tax revenue as the primary source of a country’s income, any leakage due to non-compliance behaviour may impact the country, which will eventually affect citizens. One way to reduce tax non-compliance is through compliance strategies which can be categorised into two; deterrence and accommodative approach. It is advisable that tax authority should not only focus on the deterrent approach (tax audit and penalty), mainly on tax offenders. Instead, tax authority also needs to find ways to preserve good taxpayers’ continuous fulfilment of their tax responsibilities, encourage future taxpayers to commit to tax laws, and transform tax offenders to become good taxpayers using the accommodative approach. This study uses the survey method to determine individual taxpayers’ perception of tax authority’s compliance strategies (threat of punishment, tax education programme, treatment provided by tax authority, special voluntary disclosure programme (SVDP)). This study then investigates the influence of those compliance strategies towards tax compliance behaviour. Our findings indicate that individual taxpayers have a positive perception towards compliance strategies provided by the tax authority in Malaysia (refer to Inland Revenue Board of Malaysia (IRBM)). In addition, the threat of punishment, treatment provided by IRBM and SVDP are significantly proven to have a positive relationship with tax compliance. However, it is suggested that IRBM should improve their tax education programmes as it is found to be insignificant. This study contributes to current tax compliance literature in a relatively important field of compliance strategies by providing comprehensive insights into the influence of both deterrence and accommodative apporaches in influencing tax compliance behaviour, as well as focusing more on an accommodative approach that is receiving attention lately. With both approaches in one study, the results of this study provide a clear, complete and comprehensive understanding since most of previous studies conducted separately. Finally, the findings of this study also provide valuable and significant input to the tax authorities and policymakers, especially IRBM in assessing and making a necessary improvement on their compliance strategies with the mission to enhance tax compliance behaviour, especially among individual taxpayers. Keywords: tax compliance; tax authority; compliance strategy; accommodative approach; deterrence approach

Sound Plans Help Thwart Identity Theft

Emotions in Tax Related Situations Shape Compliance Intentions: A Comparison between Austria and Italy

Existing literature stresses the importance of socio-economic factors when aiming to increase the willingness of taxpayers to pay their tax obligations. There have been insufficient studies on socio-psychological factors in tax morale research. This study focuses on trust in tax authorities and tax fairness factors that may explain the reasons why people pay taxes. The purpose of this conceptual review is to analyze and synthesize the theoretical and conceptual frameworks of trust in tax authorities and tax fairness in the tax morale context. Trust in tax authorities refers to the level of confidence taxpayers put in tax authorities based on how well they perform their duties. Tax fairness refers to taxpayers who perceive paying taxes as a fair process in terms of the treatments and benefits they receive for the taxes paid. Tax morale is defined as the intrinsic motivation of taxpayers to pay their fair share of taxes. Using the Social Psychology of Taxation (SPT) and Ibnu Khaldun's Theory of Taxation (IKTK), the interrelationships between trust in tax authorities, tax fairness, and tax morale are critically evaluated and analyzed. The review of relevant tax morale literature is conducted to identify any research gaps, inconsistencies, or ambiguities. It is interesting to note that there were mixed findings in terms of the effect of tax fairness on tax morale. Some studies have demonstrated positive relationships, while others have found negative ones. It has been discovered that taxpayers’ trust in tax administrations would increase if tax authorities treated taxpayers with consideration and respect, applied clear and fair procedures to all taxpayers, and assisted them in meeting their tax obligations. A psychological contract aptly captures the interaction between tax authorities and taxpayers, which will manifest in a willingness to pay taxes. Further investigation needs to be carried out in order to statistically validate the direct and indirect relationships between trust in tax authorities, tax fairness, and tax morale.

When seven million dependents vanished from the tax rolls in 1986 the IRS recovered three billion dollars in revenue. A simple enforcement measure was applied. Taxpayers were required to list the social security number (SSN) for any dependent they claimed on their tax return. Costing next to nothing to implement, the benefits of this enforcement action continue to this day. A similar enforcement measure could be employed against refund fraud. Even though the solution is not as simple as that adopted in 1986, it is similar. The effort is worth making. The revenue loss is much larger. As before, the key to the enforcement effort is to convince the fraudsters that they can be caught in real-time. This paper proposes a technology-based solution to refund fraud – W-2s (as well as 1099s, W-4s and W-9s) should be “digitally signed.” This solution is narrowly focused on tax compliance, and does not pursue broader concerns with identity theft that underpins some of the more serious instances of this fraud. This solution is not “paper based.” The digital signature is both an alpha-numeric string and a 2-D bar code and can be transmitted in an e-file as well as a paper document. Employees will have the ability to independently check the accuracy of any digital signature associated with their employment by accessing an IRS web site that will identify mis-matches (if any). Employees will be able to demand that their employer correct any signatures found to be in error. There are five classes of filing mis-match/refund frauds that this proposal confronts. The five classes are: 1. Identity mis-matches (when SSA/IRS databases do not match identity-data on the forms/returns filed); 2. When legitimate W-2s or 1099s are altered by taxpayers; 3. When fraudsters steal identities and then file false returns; 4. When taxpayers collude with professional tax-preparers (2-party collusions), and 5. When businesses, professional tax-preparers and taxpayers collude (3-party collusion). A tax solution must reach two groups – legitimate taxpayers and outright identity thieves. A tax solution will not prevent identity theft, nor will it solve SSN theft. It does not need to do so to be successful. This is not to say that preventing refund fraud may go a long way to reducing these thefts. Identity and SSN theft occur for many more reasons than simply to secure false refunds from the tax system.

Simple SummaryPeople can develop meaningful relationships with companion animals, and they behave towards them in specific ways. For example, they spend time together in close proximity, apologize or talk to them as if they are human, and experience social support from their pets. This study aims to explain these types of interactions in a sample of cat owners and dog owners in the Netherlands. The more pet owners rated the mental abilities of their pet to be similar to those of humans (anthropomorphization), the more they displayed making-up behavior towards their pet, and the stronger they experienced social support from their pet. However, to engage in communication behavior (e.g., petting, kissing, talking) it is not necessary to anthropomorphize the pet. Dog owners anthropomorphize more than cat owners; this might be due to a higher symmetry in social behaviors between humans and dogs. Lastly, the social role of the pet (partly) mediates the association between anthropomorphization and owner behaviors and experience of social support. This mediation effect is more pronounced in cat owners compared to dog owners.Background: For sustainable and healthy relationships with pets, attributing some degree of human abilities to the pet (anthropomorphization) might be necessary. We hypothesize that the tendency to anthropomorphize pet animals is related to relationship behaviors (communication and making up) and the experience of social support. Perceiving the pet in a human social role (e.g., family member or friend) might mediate this relationship. Method: Associations were tested in a mixed sample of cat and dog owners by means of multiple linear regression, moderation, and (moderated) mediation analyses. The differences between cat and dog owners were examined with pet type as the moderator in a moderated mediation analysis. Results: Dog owners anthropomorphize their pets more than cat owners. The social role of the pet mediates the association between anthropomorphization and relationship behavior and social support. The mediation effects were stronger for cat owners than for dog owners. Moreover, our newly developed comparative anthropomorphism measure was a better predictor than the commonly used general anthropomorphism measure (IDAQ).

The increasing digitalization of global trade and finance has profoundly transformed cross-border taxation systems, introducing new efficiencies but also escalating cybersecurity vulnerabilities. As tax authorities and multinational corporations adopt digital reporting, blockchain-enabled auditing, and AI-based compliance tools, the risk of data breaches, ransomware attacks, and identity theft has multiplied. This paper examines the impact of cybersecurity threats on cross-border taxation, focusing on how cyber incidents undermine fiscal transparency, disrupt revenue collection, and erode taxpayer trust. It explores the interplay between international data exchange mechanisms—such as the OECD’s Common Reporting Standard (CRS)—and the evolving landscape of cyber risks that accompany these digital tax frameworks. The study also highlights how inconsistent cybersecurity standards among jurisdictions create systemic weaknesses that can be exploited by cybercriminals to manipulate tax information or evade compliance. Furthermore, it discusses the emerging role of regulatory cooperation, digital sovereignty, and data protection frameworks like GDPR in safeguarding tax ecosystems. By integrating insights from cyber risk management, digital governance, and international tax law, this research emphasizes the necessity of a unified global cybersecurity approach to ensure tax integrity and equitable revenue administration in an increasingly digital economy. The findings contribute to policy discussions on how technological resilience and secure digital infrastructures can reinforce trust and accountability in cross-border taxation systems.

Background: Tax consultants are central to supporting taxpayer compliance in Indonesia. While technical competence is essential, their performance also depends on constructive engagement with tax authorities, an aspect rarely examined in the Indonesian context. Methods: This study employed a quantitative survey of 158 licensed tax consultants in Indonesia. Data were analyzed using Structural Equation Modeling (SEM-PLS) to test the direct and mediating effects of technical skills and relationships with tax authorities on job performance. Findings: The results indicate that technical skills significantly improve both relationships with tax authorities and perceived job performance. Furthermore, relationships with tax authorities mediate the effect of technical skills on performance, highlighting their strategic role in enhancing consultants’ effectiveness. Conclusion: Strong technical competence, when combined with positive relationships with tax authorities, enables consultants to provide accurate advice, strengthen compliance, and build professional credibility. For policymakers and professional associations, these findings suggest the importance of continuous technical training and fostering collaborative forums between tax consultants and tax authorities. Novelty/Originality: This study contributes empirical evidence from Indonesia by introducing relationships with tax authorities as a mediating variable between technical skills and tax consultant performance. This relational perspective enriches existing tax compliance literature and offers insights for professional practice.

To trust is to believe that another person will cooperate for your benefit and will not take advantage of you if an opportunity to do so arises. Trust is valued as a relational variable providing the base for voluntary cooperation. This article aims to determine, by reviewing studies on the effect of trust in tax authorities on tax compliance, the determinants, effect and measurement of trust in this context. Findings from a number of studies indicated that trust in tax authorities is positively related to tax compliance, and it was found that perceptions of fairness, treatment by authorities, norms and attitudes, and subjective tax knowledge are the main factors determining trust in tax authorities. However, many studies use very limited descriptors when measuring perceptions of trust in authorities, and it is suggested that a standardised survey instrument could be developed to measure such perceptions.

Purpose This study aims to understand the determinants of the relationship between tax authorities and taxpayers in the digital era and how this relationship impacts tax compliance behavior, especially in the context of emerging countries like Morocco. Design/methodology/approach A qualitative methodology was adopted, involving interviews with tax inspectors and auditors, certified accountants’ experts and tax consultants. Data analysis was conducted using IRAMUTEQ software. Findings The research highlights that the relationship's quality and the level of mutual trust between tax authorities and taxpayers are critical in determining tax compliance in the digital era. Central factors affecting this relationship encompass effective communication, simplification of tax procedures, clarity of tax laws and the digitization of tax services. Furthermore, the study emphasizes that these dynamics and determinants significantly influence the tax compliance behavior of taxpayers in Morocco, revealing intricate connections between relational aspects and compliance attitudes. Practical implications The findings suggest that fostering a mutually trusting relationship, through improved communication, simplification and digitization, can enhance taxpayer compliance. This is valuable for policymakers and tax authorities developing strategies to improve tax systems in emerging countries. Originality/value This study contributes to the sparse literature on the relationship between tax authorities and taxpayers in the and digital era, offering new insights into factors that influence tax compliance in the post COVID-19 crisis context. Its practical recommendations provide a foundation for developing strategies aimed at improving this relationship and, consequently, taxpayer compliance behavior in emerging countries.

This paper uses actuarial models to analyze the impact of tax authority's full responsibility collection of social security fee on the scope for reducing the pension insurance contribution rate. The study finds that: (1) The tax authority's full responsibility for collecting social security fees can increase the pension insurance collection rate by 20.3%-25.2%; (2) If the balance of fund income and expenditure and pension treatment remain unchanged, the contribution rate can be reduced by 1.34–2.22% in 2021–2030; (3) If the state-owned shares are transferred to enrich the social security fund, the contribution rate can be reduced by 3.58–4.22% in 2021–2030, and the payment burden of enterprises can be significantly reduced. In short, if the tax authority is fully responsible for collecting social security fees, it can provide conditions for lowering the contribution rate of pension insurance, but it needs to cooperate with other policies, such as the transfer of state-owned shares to enrich the social security fund. Chinese government should gradually clarify the tax authority's responsibility for collection to reduce the contribution rate of pension insurance and stimulate the market vitality.

The proliferation of Internet of Things (IoT) technologies has revolutionized various aspects of modern life, including business operations and government services. This research paper delves into the intersection of IoT technologies and tax compliance, aiming to elucidate the opportunities, challenges, and policy implications arising from their integration. Through a comprehensive review and analysis of existing literature, this paper seeks to provide insights into the transformative potential of IoT in tax compliance, while also highlighting potential hurdles and offering policy recommendations. IoT technologies offer a myriad of opportunities to enhance tax compliance processes for both taxpayers and tax authorities. The ability of IoT devices to collect real-time data and automate various tasks can streamline recordkeeping, improve accuracy in reporting, and enable proactive compliance measures. For taxpayers, IoT-enabled systems can simplify tax documentation, minimize errors, and provide timely reminders for compliance deadlines. Likewise, tax authorities can leverage IoT data for better monitoring, enforcement, and risk assessment, thus enhancing overall tax administration efficiency. However, the integration of IoT in tax compliance also presents notable challenges. Privacy and data security concerns emerge as paramount considerations, given the sensitive nature of financial information involved in taxation. The vast amount of data generated by IoT devices also raises questions regarding data governance, ownership, and liability. Moreover, the digital divide may exacerbate existing disparities in access to IoT technologies, potentially marginalizing certain segments of the population and hindering equitable tax compliance. In light of these opportunities and challenges, policymakers must carefully design regulations and guidelines to harness the benefits of IoT while mitigating associated risks. Clear standards for data protection, encryption, and user consent are essential to safeguard taxpayer privacy and instill trust in IoT-enabled tax compliance systems. Additionally, implementation of measures to bridge the digital divide and ensure equitable access to IoT technologies, thereby promoting inclusivity in tax compliance efforts. Furthermore, tax authorities need to develop robust frameworks for data governance, encompassing data collection, storage, sharing, and usage. Collaboration between public and private sectors is crucial to foster innovation in IoT-based tax compliance solutions while adhering to regulatory requirements and ethical principles. In conclusion, the integration of IoT technologies in tax compliance holds immense potential to revolutionize the way in which taxes administered and enforced. However, realizing this potential necessitates a holistic approach that addresses technical, legal, and socio-economic considerations. By embracing innovation while safeguarding privacy and inclusivity, governments can harness the transformative power of IoT to foster more efficient, transparent, and equitable tax systems.