Voluntary Tax Research Articles

Peningkatan Voluntarty Tax Compliance dan Kinerja Direktorat Jenderal Pajak

This study aimed to compare the tax revenue between before and after the implementation of Government Regulation No. 46 In 2013, and knowing the efectiveness of voluntary tax compliance’ increase tax-payer for SMEs. The study was conducted by using a mixed method in which for the first goal using different test methods of quantitative premises while the second goal using qualitative descriptive method to illustrate the effectiveness of the regulation. The results showed that the tax revenue after the implementation of the regulation indeed there is a greater difference than before the implementation of these regulations. The second result shows that the application of the regulation is less effective in the first 5 months of implementation.

The effects of mass media campaigns on individual attitudes towards tax compliance; quasi-experimental evidence from survey data in Pakistan

Pakistan has consistently performed low on taxation, with revenue collection hovering around 10% of GDP. Tax reforms have been attempted but without significant gains in revenue collection. Due to the recalcitrance of tax revenues, the tax authority attempted to enlist voluntary compliance, as one of the avenues for its efforts to increase collections. This paper examines the effectiveness of mass media campaigns in the TV and national newspapers used by the Federal Board of Revenue (FBR) of Pakistan to increase awareness, tax filing, and, ultimately, tax morale. We use survey data that were collected in 2014 immediately after these mass media campaigns by the FBR. Using coarsened exact matching, we construct treatment and control groups that are nearly identical in terms of pretreatment balance of demographic and behavioral predictors of high tax morale. We find improved perceptions towards tax compliance in Pakistan for respondents exposed to the TV and newspaper advertisements. The choice of the advertisement's delivery device is important since the latter is more effective. Our findings provide empirical evidence that well-timed mass media campaigns can enhance voluntary tax compliance.

Does Voluntary Tax Compliance Increase After Granting Tax Amnesty?

Objective - The main objective of this study is to explore the meaning of voluntary tax compliance by a person after they are granted tax amnesty. Methodology/Technique - This research is qualitative research and uses a transcendental phenomenology method. Findings - The results show that tax compliance does not automatically increase after a grant of tax amnesty. The reason for this is the fact that taxpayers wish to avoid being tax audited. Tax amnesty is therefore not yet useful in build trust in the tax authority. Tax authorities need to convince the public that tax amnesty creates justice for all taxpayers. The power of the tax authority is useful to strengthen law enforcement measures. Furthermore, fundamental moral and ethical considerations based on internalization, spirituality and religion tend to improve taxpayers' honesty. Novelty - The trust and power of a tax authority that is in line with taxpayers' honesty is fundamental voluntary to tax compliance. The results of this research demonstrate the need for new tax policies to increase voluntary tax compliance Type of Paper: Empirical Keywords: Moral Ethics; Tax Amnesty; Transcendental Phenomenology; Trust; Voluntary Tax Compliance. JEL Classification: H20, H21, M41.

VOLUNTARY TAX COMPLIANCE WAJIB PAJAK PERUSAHAAN PERHOTELAN: DETERMINAN, KEPERCAYAAN DAN KEKUASAAN LEGITIMASI

The aim of this research are to give empirical proof about: (1)the influence procedural juctice and moral obligation toward voluntary tax compliance. (2) the influence of trust within mediation influence between procedural juctice and moral obligation toward voluntary tax compliance. (3) the influence of legitimation power within moderation influence of tust toward voluntary tax compliance. Data collection in this research using quisioner. As many as 108 quisioner divided to manager and accountan in each hotel. From data above, 91 quisioner are given back by responden. So, 91 quisioners can be used in analysis proses. The result of this research eviden, the procedural jucticeand moral obligation ralated to voluntary tax compliance. The result of this research also eviden the role mediation of trust. Voluntary tax compliance occurs becouse of procedural juctice and moral obligation direct to voluntary tax compliance through mediation of trust, and realionship between trust and voluntary tax compliance are not moderation by legitimation power.

Fear and caring: Procedural justice, trust, and collective identification as antecedents of voluntary tax compliance

We investigated the interactive roles of procedural justice of the tax authority, trust in the tax authority, and identification with the nation in predicting voluntary tax compliance. Drawing from fairness heuristic theory and relational models of justice, we predicted that the relationship between procedural justice and voluntary tax compliance that has been found particularly among citizens with low (vs. high) trust in the tax authorities is restricted to citizens who weakly (vs. strongly) identify with the nation. The results of a field study with samples of Ethiopian and US taxpayers as respondents largely support our predictions. This research integrates the role of important and well-studied social psychological factors that shape voluntary tax compliance and reveals support for the hypothesis in a developing (i.e., Ethiopia) and a developed (i.e., US) nation – nations with strongly divergent tax climates.

The Improvement of a Tax Compliance Program: the Case of Mersin City

As it known, postgraduate education contributes to the development of individuals who the community needs and have high level knowledge and skills, also it helps to manyindividuals to specialize and have a career. Many public institutions provide scholarships for the development of postgraduate education, also they provide Erasmus facility to them in Turkey. Postgraduate education prepares to individuals to the academic world by combining research methods lesson and on the use of SPSS with a course-based. Students who have completed the 10 lessons in the postgraduate education are starting their thesis studies with the form of a thesis proposal which must be given within the legal process. So we started to work about voluntary tax compliance that we have determined with our advisor after the thesis phase, we have combined it with the basic subjects of the tax ethics and tax consciousness in the Public Finance. The aim of this study is to examine the thesis study for the explain the mechanism of postgraduate education of Mersin University the study named “The Improvement of A Tax Compliance Program: A Case of Mersin City” which currently being carried out with BAP (Scientific Research Projects) support. In this study including that the definition of voluntary compliance, theoretical development and evaluation of successful country implementations. It aims to reach 400 people on the basis of Mersin City by following the quantitative research strategy. Survey method will be used for the collection of data and SPSS Statistics 20 for analyzing of data for empirical part of thesis.* This study was supported by the Research Fund of Mersin University in Turkey with Project Number 2017-1-TP2-2249.

Taxpayers’ perceptions on tax evasion behaviour: an empirical study in Malaysia

PurposeThe success of self-assessment tax system is voluntary compliance with the tax laws. When tax evasion is seen as unacceptable, taxpayers will tend to evade tax less. Hence, the understanding of taxpayers’ attitude on tax morality towards a tax system has to be enhanced to minimize tax evasion cases. The purposes of this study are to examine the relationship between tax fairness, tax knowledge, enforcement level and social exchange towards taxpayers’ attitude of tax morality under the self-assessment system in Malaysia and also to identify the relationship between taxpayers’ attitude of tax morality and taxpayers’ perceptions on tax evasion.Design/methodology/approachData were collected from 400 taxpayers through a questionnaire and analysed.FindingsFrom the analysis, it has been found out that tax knowledge is the most important tax system characteristic that affects taxpayers’ attitude of tax morality. In addition, taxpayers’ attitude of tax morality is significant to taxpayers’ perceptions on tax evasion in Malaysia.Originality/valueThe findings of this study would be useful for the government to further improve the present tax system to increase voluntary tax compliance.

An Evaluation of Governments’ Initiatives in Enhancing Small Taxpayers’ Voluntary Tax Compliance in Developing Countries

Tax compliance has been a problem in many developing countries. Even though various mechanisms have been adopted to enhance compliance among tax payers, the success has not yet been achieved. The focus of this study is to access approaches on how to promote voluntary compliance among taxpayers in developing countries specific case of Tanzania. The study adopted cross sectional research design whereby a cross-sectional survey and descriptive analytical methods were adopted. Both primary and secondary data were collected and analysed. The study found that in order for the small tax payers to comply voluntary with tax laws and regulations; the government should focus on the use of information technology communicating i.e. mobile phones; reduction in tax rate to minimize tax burden; increase accountability and transparency among tax authority officials. The study recommendation include: Improvement of tax-education to improve understanding between government and taxpayers in all tax matters, preparation of motivating mechanisms to influence the small tax payers to participate fully in paying tax voluntarily, adoption effective tax collection methods and proper utilization of collected revenues, improvement of social services, increase in tax knowledge to both small taxpayers and tax officials, frequently training of tax officials and tax payers education to increase transparency and accountability. Through the study recommendations will improve the Tanzania’s government strategies in enhancing small tax payers’ voluntary tax compliance.

KEPATUHAN PAJAK DALAM PERSPEKTIF NEO ASHABIYAH

The aim of this study is to analyze tax compliance behavior through “neo ashabiyah” perpective. The core of ashabiyah originally were a kind of bond of kinship, tribal ties, ethnic solidarity or social cohesion. Neo ashabiyah is developed since we founded that there were uncompliance behavior in fulfill tax obligation among taxpayers in the world. By neo ashabiyah, this study would explained how social cohesion mechanism take a look at efforts to avoid tax as collective consciousness that unified and tied exceeding their ethnic, interfaith, cultural, and country barriers. The merge of these awareness is twisted in a global consciousness that characterized by no country is free from the problem of tax compliance. These avoiding consciousness is connected as well as communicate at non-rational traffic domain (known as sub conscious in the modern perspectives) that permeate their cultural, ethnic, and country. This means that the voluntary tax compliance can never be achieved by any means because the consciousness occupies in the field of irrational consciousness. Tax compliance, if it is reached is forced compliance and not voluntary compliance

Referent Points and Taxpayerss Compliance: Insights into Taxpayerss Risk Preferences for Honest Reporting

Prior research (Schepanski and Shearer, 1995; Alm and Torgler, 2011) relying on prospect theory (Kahneman & Tversky, 1979) shows that taxpayers’ compliance is influenced by their perception of whether they owe more or less taxes than they anticipated: Taxpayers are more likely to cheat on their taxes when they perceive that they are in a tax “loss” position as compared to a tax “gain”. Yet what remains to be understood is what exactly constitutes the referent point that separates a tax loss from a tax gain. In an attempt to provide in-depth insight of what constitutes the referent point for taxpayers, we observe taxpayers filing their actual tax return and investigate the extent to which different proxies for the referent point used in prior literature best differentiates between taxpayers’ preference to cheat or file their taxes honestly. Our findings indicate that expected asset position is critical to influencing taxpayers’ ethical behavior. This revelation is important as it suggests that taxpayers’ perceptions influence their tendency to report honestly and comply with tax authorities. Our research is important to the tax authority for determining how to encourage voluntary tax payments, and contributes to the tax ethics literature by clarifying the point which differentiates between taxpayers’ tax gain and tax losses. and in so doing, their tendency to file their taxes honestly.

The Mediating Effect of Tax Fairness on the Relationship Between Knowledge, Complexity and Voluntary Tax Compliance

This study aims to examine the mediating role of tax fairness on the relationship between tax knowledge, tax complexity, and voluntary tax compliance. Based on 200 samples of taxpayers, it is found that tax knowledge increases tax fairness perceptions, which, consequently, increases tax compliance behaviour. Similarly, tax fairness perceptions do not reduce the tax compliance directly, but indirectly through the role of tax fairness perceptions. This implies that tax authorities should not only focus on introducing or developing tax rules that are fair to the taxpayers but be able to communicate the rationale of a tax rule in the context of how it permeates fairness into the tax system for certain classes of taxpayers. Our study found that, in situations where tax simplification is not possible, this form of information dissemination could lead to better compliance among taxpayers. Keywords: Tax Compliance, Knowledge, Fairness, ComplexityJEL Classification: H260

Tax compliance in a social setting: The influence of social norms, trust in government, and perceived fairness on taxpayer compliance

Voluntary tax compliance is important for governments around the world as they try to manage budget deficits. Traditional methods to improve tax compliance, such as increased audits, can be costly to implement. The purpose of this study is to examine the influence that social factors have on individuals' tax compliance intentions. Results of a survey of 217 U.S. taxpayers found support for the influence of social factors on tax compliance. This research concludes that social norms influence compliance intentions indirectly through internalization as personal norms. Specifically, as the strength of social norms in favor of tax compliance increases, personal norms of tax compliance also increase, and this leads to a subsequent increase in compliance intentions. We also conclude that trust in government has a significant influence on both perceived fairness of the tax system and compliance decisions. This study adds to current tax research in two important ways. First, the results suggest that the influence of social norms on tax compliance is largely through internalization as personal norms. Second, to the best of our knowledge this is also the first tax compliance study in which perception of fairness is modeled as a function of trust rather than vice-versa. This research may help taxing authorities develop less costly and more effective strategies for increasing taxpayer compliance.

The Impact of Religiosity on Tax Compliance among Turkish Self-Employed Taxpayers

The aim of this study is to explore the impact between religiosity and voluntary tax compliance and enforced tax compliance for self-employed taxpayers in Turkey, where Islam is the predominant religion. A questionnaire survey was administrated to 375 male and 28 female self-employed taxpayers. In this paper, two dimensions of religiosity, namely interpersonal and intrapersonal religiosity, were studied. Factor analysis and ordinary least squares regression methods were used for data analyses. The results of the study illustrate that general religiosity has a statistically positive impact on both voluntary and enforced tax compliance. When we consider the dimensions of religiosity, only intrapersonal religiosity appears to be a significant contributor only to voluntary tax compliance. Nevertheless, interpersonal religiosity has no significant statistical effect on both voluntary and enforced tax compliance. This is one of the pioneer studies of its kind, and investigates the relationship between religiosity and tax compliance from the perspective of developing countries, particularly, Turkey.

The Concept of ‘Aggressive Tax Planning’ Launched by the OECD and the EU Commission in the BEPS Era: Redefining the Border between Legitimate and Illegitimate Tax Planning

In recent years, the need to prevent and combat aggressive tax planning has played a key role not only in the agendas of international organizations and supranational institutions (OECD, EU, G-20, UN), but also in the agendas of national tax administrations. In this context, given the constraints and problems that result from the traditional model of enforcing tax obligations, the OECD is working towards the implementation of a complementary model of cooperative compliance, which shall be regarded as an instrument to improve voluntary tax compliance and to prevent tax fraud, tax evasion and aggressive tax planning. This piece of work addresses the fuzzy concept of aggressive tax planning in the framework of cooperative compliance programs and assesses how the ‘tax paradigm’ shift that is taking place at the international level (BEPS global tax reset) affects the delineation of the border between legitimate tax planning and tax avoidance, thus raising a number of issues and problems for taxpayers insofar as the redrawing of this thin red line has not been conducted in a globally uniform, transparent and consistent manner.

The Carrot and the Stick: Evidence on Voluntary Tax Compliance from a Pilot Field Experiment in Rwanda

Large-scale field experiments on tax compliance have been a thriving field of research in many regions of the world. However, Africa is still lagging behind, as administrative data from anonymised returns is available only in a handful of countries. To the best of our knowledge, there is as yet no published evidence of a tax field experiment from Africa. This paper reports the results of a pilot experiment in Rwanda that served as a stepping stone for a larger experimental study on tax compliance. In this pilot, we test the process of messaging taxpayers to encourage them to comply voluntarily, by providing information on sanctions. The results indicate that communication strategies that aim to inform taxpayers may be effective in increasing tax compliance. However, these results are only indicative. They will be complemented by further evidence from the larger field experiment, where we test different types of messages and delivery methods. Nonetheless, this paper provides some initial insight into the use of tax experiments in Africa, both in terms of initial evidence and lessons learned for future efforts in this field.

Honesty, tax fairness, government's responsiveness and voluntary tax compliance in Nigeria

Government needs funds to provide some basic social amenities for the generality of the masses and tax presents a sure way of getting a large sum of these needed funds in most countries. However, it is noted that people do not like paying tax because of government's dishonesty by not fulfilling their promises to the people; because taxpayers feel that taxes imposed on them are not fair; and due to government's non-responsiveness to the plights and aspirations of the citizens. This paper examines how taxpayers' perception of honesty, tax-fairness and government's responsiveness could impact their voluntary tax compliance. Cross-sectional survey using structured questionnaire was adopted. Sample size of 1,700 was randomly selected from the population of tradesmen and artisans totalling 11,900, belonging to 17 trade associations in Lagos State. 69% response rate was achieved. Spearman's correlation and PLUM-ordinal regression were used to analyse the data. This paper argues that voluntary tax compliance would be encouraged if government is perceived to be honest, tax being perceived to be fair and government is perceived to be responsive to the plights and aspirations of the citizens. Recommendations made in line with the findings.

Rewarding tax compliance: taxpayers' attitudes and beliefs

In a society the tax climate is determined by the interaction between taxpayers and tax authorities. In a ‘service and client’ climate, taxpayers do not expect authorities to automatically suspect them of being tax evaders. Evidence suggests that recognising good tax behaviour with strategies of rewards has a positive effect on voluntary tax compliance. Principles derived from the cognitive evaluation theory predict that when feelings of competence are affirmed and this is accompanied by a sense of autonomy it can enhance the intrinsic motivation for an action. The present research surveyed the attitudes and beliefs of taxpayers involved in small business on being rewarded for tax compliance. Results were corroborated with the principles of the cognitive evaluation theory and it was found that that the principles of the theory are applicable to rewarding tax compliance behaviour.

Power, justice, and trust: A moderated mediation analysis of tax compliance among Ethiopian business owners

We explored the moderating roles of legitimate and coercive power held by the tax authority in the relationship between procedural justice, trust in the tax authority, and voluntary tax compliance. Drawing from fairness heuristic theory and the slippery slope framework of tax compliance, we predicted that procedural justice fosters voluntary tax compliance, particularly when legitimate power of the tax authority is low and when coercive power of the authority is high. Moreover, we predicted that these interactive effects are mediated by (cognition-based) trust. Finally, we predicted that coercive power of the tax authority is positively related with enforced tax compliance. The results of a field study among Ethiopian business owners supported most predictions. This research is among the first to integrate social–psychological and deterrence-related factors to understand tax compliance behavior in a developing country.

Civil and Criminal Effects of the Voluntary Tax Disclosure Declaration in Chile: Lessons for Brazil and Argentina

The Sworn Declaration contained in Article 24 of Law 20.780 established the conditions to apply for a Tax Amnesty, at a rate of 8% of the value of the assets, provided that the property was identified as being part of the taxable patrimony of a person who is a resident of Chile, both conditions before 1/1/2014. The malicious introduction of assets or income of third parties in the Sworn Declaration has both a criminal and administrative qualification for the application of sanctions.

The Ethical Practice of Tax Consultant Based on Local Culture

The main objective of this study is to explore in depth the ethical practice of tax consultant at the Tax Consulting Firm Nyoman Polos. This research conducted Transcendental Phenomenology method. The results show that the professional ethics of tax consultant more emphasis on the aspect of formality. Its mean that an idealist will apply ethic in providing tax consulting services. Concept in Hinduism is based on Catur Purusa Artha (Dharma, Artha, Kama, and Moksha) will form an idealistic and spiritualist tax consultant. Ethical practices by tax consultants based on local culture enable to increase voluntary tax compliance.