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This study focuses on the determinants of taxpayer compliance behaviour with respect to corporate income tax reporting requirements in Malaysia. A researcher-administered questionnaire survey method for data collection was utilised. The findings of this study reveal that business age, tax liability and tax complexity consistently influence the like...
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Abstract
Purpose – The purpose of this study is to explore the variables that affect Muslim consumers’ perception
towards tax rebate over zakat on income in Malaysia.
Design/methodology/approach – A close-ended structured questionnaire was developed and a total
number of 236 valid responses were collected through online survey from the Muslims resi...
Citations
... According to Hite and Roberts (1992) and Vincent (2021), the perception of fairness has a strong correlation with the perception of an improved tax system and dissuades taxpayers from deciding on non-compliance. Determinants of tax attitudes and perceptions are fairness and equity in fiscal revenue distribution, trustworthiness and accountability for taxes collected by the government, the peer influence of other taxpayers, and the taxpayer's moral obligation to file complete tax returns (Francis, 2019;Sapiei et al., 2014;Vincent, 2021). ...
This study explores how different factors affect tax compliance behavior among Romanian individual taxpayers. By unpacking tax compliance into nine drivers—tax system fairness, trust in government and tax authorities, efficiency, and transparency of government spending, knowledge of tax legislation, tax legislation simplicity, personal financial constraints, personal ethics, and moral standards, the social environment, and coercive measures—this study develops clear-cut paths of the drivers of tax compliance from the perspective of a developing country. The proposed research hypotheses were tested with a sample of 402 individual taxpayers and quantitative data analysis was carried out using partial least squares-structural equation modeling. The results showed that seven drivers (tax system fairness, trust in government and tax authorities, knowledge of tax legislation, personal financial constraints, coercive measures, moral standards, and tax legislation simplicity) were significant factors that increase the likelihood of tax compliance among individual taxpayers. Our findings are expected to provide tax authorities and governments new insights on tax compliance behavior that enable them to develop fiscal methods, strategies, policies, and legal measures tailored to local context, and constraints.
... They have provided a theoretical framework to explain the factors that affect individual compliance (Fischer et al., 1992;Cuccia, 1994;Devos, 2014). At the same time, some previous studies of business compliance have recognized that individual taxpayers compliance theory can be applied to explain business compliance (Tedds, 2010;Sapiei et al., 2014). ...
... An adequate amount and increase in the contribution of PAD will determine the level of independence of the Regency/City Government in regional development. Therefore, it does not always depend on assistance from the Central and Provincial governments (Sapiei, 2014). According to Article 157 of Law Number 32 of 2004, Regional Original Revenue is a source of income consisting of tax proceeds, levies, separated wealth management results and other legitimate original income. ...
This study aims to identify and analyze the dominant factors that influence regional tax revenues in Jambi Province, especially in 2015-2019. The variables used are taxpayers, per capita income, number of industries, banking credit, balancing funds, infrastructure, domestic investment (PMDN), and micro, small and medium enterprises (UMKM) as independent variables, while regional tax revenue is the dependent variable. This analysis tool uses quantitative analysis with multiple regression formulations of panel data, a combination of the time series in the form of a 2015-2019 time series and a cross-section, namely the latitude of the Regency / City in Jambi Province. The income per capita, taxpayers, bank credit, balancing funds, Micro, Small and Medium Enterprises (UMKM) and Domestic Investment (PMDN) significantly affect regional tax revenues. Meanwhile, the number of industries, infrastructure, and balancing funds do not significantly affect regional tax revenues.
... Numerous empirical studies provide evidence that taxpayer compliance behaviour is significantly affected by the presence of penalties. For instance, the perceived severity of penalties plays a crucial role in ensuring compliance among various groups, including low-income individuals (Efebera et al., 2004), small and medium enterprises (Alshira'h & Abdul-Jabbar, 2020), and large corporations (Sapiei et al., 2014;Ya'u et al., 2020). ...
... Tax penalties show a positive but statistically insignificant relationship with willingness to pay taxes, while tax system complexity exhibits a negative and statistically significant relationship. The insignificant result for tax penalties in this study contradicts the findings of previous studies (Alshira 'h & Abdul-Jabbar, 2020;Sapiei et al., 2014;Vincent & Ntim, 2021;Ya'u et al., 2020). However, this can be attributed to the reduced audit efforts by authorities during the pandemic (OECD, 2021b), with a greater emphasis on supporting affected households. ...
Throughout the COVID-19 pandemic, the Indonesian government has taken proactive measures to meet the needs of COVID-19 survivors by allocating substantial funds, primarily sourced from tax contributions, to support healthcare and social welfare. This study examines the drivers of willingness to pay taxes of individuals who survived COVID-19 in Greater Jakarta. We performed the study by collecting data from 411 individuals using a combination of traditional paper-based and online survey instruments. The findings indicate that several factors, including the tax system’s complexity, the dissemination of tax information, taxpayer morale, trust in the government, and the perceived worth of COVID-19-related expenditures, play a significant role in influencing individuals’ willingness to pay taxes. On the other hand, factors such as tax penalties, fairness of the tax system, and tax knowledge may not necessarily have a significant impact. However, utilising tax fairness and tax knowledge to predict regulatory compliance yields expected results, indicating a broader requirement for implementing more complex tax procedures and ensuring broader aspects of tax compliance. The results largely validate the main extended behavioural perspectives. The study also offers the theoretical and policy implications of these findings and provides suggestions for future research in the field.
... The EU theory of individual tax evasion shows a positive relationship between the possibility of underreporting and the actual act (Allingham & Sandmo, 1972;Yi haki, 1974). According to the thesis, taxpayers are immoral utility maximisers who choose to avoid taxes when the expected profits outweigh the cost of evasion (Allingham & Sandmo, 1972;Sapiei, Kasipillai & Eze, 2014). ...
... The penalty threat and sanction impact are key to the deterrence theory, with the punishment or sanction determined by taxpayer compliance behaviour. The greater the severity of the consequence and the likelihood of detection, the lower the tax noncompliance tendency (Musimenta, 2020;Sapiei, Kasipillai & Eze, 2014). The economic approach has been broadened to cover all elements that place a taxpayer at an economic disadvantage or benefit. ...
Taxation is the most important and obvious source of funding for governments
around the world. Any service that benefits the public will necessitate taxation to
cover at least a portion of the costs. Nigeria has a range of alternatives for
financing its public expenditures and implementing its fiscal policies. However,
tax compliance and remittance have been reported to be relatively low in Nigeria,
where tax revenue is the primary source of locally generated revenue. This study
then sought to examine the effects of tax system, tax behaviour and tax justice on
voluntary compliance. This study reviewed the following theories: Classical
Theory of Tax Compliance; Economic Deterrence Theory; Fiscal Exchange
Theory; Comparative Treatment Model; Political Legitimacy Theory; Behavioural Economics Theory; and Theory of Planned Behaviour. The primary data was gathered and analysed with Google Forms. From the findings, the study
revealed that implications of tax evasion make Nigerians to be tax compliant.
However, it can be concluded that the inefficient Nigerian tax system, tax
behaviour and tax justice yields low tax compliance. Therefore, this study
recommends that Government should continue to provide basic amenities to its
citizens and be accountable, as this will convince citizens that tax monies are being
utilised; Tax education should be carried out frequently. Tax administrators should administer taxes within the ambit of the law; while the use of technology
and professionally trained employees should continue to be encouraged. Tax
authorities should endeavour to work with other agencies such as Corporate
Affairs Commission (CAC), Independent Corrupt Practices Commission (ICPC)
and Economic and Financial Crime Commission (EFCC) aid citizens tax
compliance; and tax administrators should ensure that updated records of
individuals and companies are maintained.
... Many empirical studies in tax compliance focus on economic and behavioural factors responsible for (non)compliance (Dimnwobi et al., 2022;Vincent, 2021b;Sebele-Mpofu, 2020;Musimenta, 2020;Aladejebi, 2018;Oana, 2018;Sapiei et al., 2014;Elffers et al., 1992;Lewis, 1982;Warneryd and Walerud, 1982;Yitzhaki, 1974;Allingham and Sandmo, 1972) but a little is known of the connection between sociodemographic characteristics of the taxpayers and the tax compliance tendency. The prior attempts to empirically unpack the impact of sociodemographic factors on tax compliance were carried out in advanced economies and little or no contributions emanated from Africa (Ahmed and Braithwaite, 2004;Ashby et al., 2009;Bobek et al., 2007;Kastlunger et al., 2010;Wenzel, 2007;Amponsah and Adu, 2017). ...
... A few studies have found a relationship between the business sector an entrepreneur belongs to and tax compliance behaviour. Sapiei et al. (2014) found the business sector to be a good determinant of tax compliance. The authors found that businesses in the manufacturing sector were more compliant than those in the services sector. ...
... The previous studies in gauging tax compliance have been executed by laboratory experiments (Alm, 2012;Torgler, 2007), cross-sectional design (Vincent, 2021b;Carsamer & Abbam, 2022;Sapiei et al., 2014;Frey and Torgler, 2007), field experiments (Kleven et al., 2011;Slemrod et al., 2001), and tax audit (Schneider, 2005). The tax audit may not be feasible because taxpayers' records are only accessible by officials of tax authorities while both field and laboratory experiments may not be easy to organize because of the need to create a real-life atmosphere for the field experiments and a contrived environment for the laboratory experiments. ...
... Several studies have tried to analyzed the impact of tax compliance on non oil tax revenue (such as (Arif & Rawat, 2018;Asaolu et al., 2015;Gitaru, 2017;Madugba et al., 2015;Meagher, 2018;Ngozi & Obioma, 2018;Niway & Wondwossen, 2017;Okee & Isoso, 2022;Oluyombo & Olayinka, 2018;Sapiei et al., 2014;Umar et al., 2017) and arrive at the contradictory results making it difficult to establish with certainty the logic, nature and significance of the impact of tax compliance on non oil tax revenue growth in Nigeria. The implication is that empirical investigations fail to provide conclusion result about the growth in non oil tax revenue. ...
The paper investigated the tax compliance (active tax payers) and non oil revenue in Nigeria in relation to fiscal exchange theory and expectation proposition. The study adopted ex post facto research design; secondary data for nineteen years (2003-2022) were collected from various issues of the Federal Inland Revenue Services (FIRS) statistical bulletin and annual reports. Tax compliances as regressand variable was measured with number of actual annual total non oil tax revenue in Nigeria and Tax compliances among active tax payers of company income tax (CIT), Petroleum profit tax (PPT), Capital gain tax (CGT), Value Added Tax (VAT) and Personal Income Tax (PIT) as regressors. The data was analyzed using multiple regression analysis to establish the relationship between the dependent and independent variables. The findings revealed that tax compliance have significant effect on boosting tax revenue generation and that tax default can cause significant variation in government revenue. The variable in the model is significant at the 5% critical level and the regression coefficient reveals that 72.8% of the total variation in revenue is accounted for by tax compliance with other variables in the stochastic term accounting for the remaining 27.2%. Specifically, Tax Compliance (Active Tax Payers) is significantly and positively related
... The deterrence theory focuses on the sanction threat and sanction effect, the punishment or sanction determined by taxpayer compliance behaviour. The more the severity of sanction and probability of detection, the lower the tax noncompliance tendencies is (Musimenta, 2020;Sapiei et al., 2014). According to Alm et al (2012), the deterrence theory assumes taxpayers inherently wish not to pay tax liability, and are "deterred" from doing so solely by the risk of being audit, detection, and penalty. ...
... Theo Mohdali và Pope (2012), cơ quan hoạch định, ban hành chính sách, cơ quan QLT có mối quan hệ mật thiết đến tuân thủ thuế, xem tuân thủ thuế như là công việc mà bất kỳ NNT nào cũng phải thực hiện như là báo cáo chính xác thu nhập và kê khai các khoản chi phí theo quy định của pháp luật thuế (Sapiei, Kasipillai, & Eze, 2014). Đồng thời, thông qua một số đặc điểm có thể xác định hành vi tuân thủ của NNT như báo cáo trung thực về căn cứ tính thuế, tính toán chính xác các khoản thuế, nộp tờ khai và nộp tiền thuế đúng hạn (Andreoni, Erard, & Feinstein, 1998). ...
Mục đích chính của nghiên cứu nhằm xác định các nhân tố và thang đo cho các nhân tố tác động đến tuân thủ thuế của doanh nghiệp từ quan điểm của cơ quan quản lý thuế. Bằng phương pháp nghiên cứu hỗn hợp, kết hợp tuần tự phương pháp nghiên cứu định tính và phương pháp nghiên cứu định lượng, kết quả cho thấy có bốn nhân tố có ý nghĩa thống kê tác động thuận chiều đến nhân tố Tuân Thủ Thuế (TTT), mức độ tác động từ cao đến thấp đó là: (i) Nhân tố kinh tế; (ii) Nhân tố xã hội; (iii) Nhân tố cá nhân; (iv) Nhân tố thể chế.
... The Malaysian tax authorities are making attempts to improve compliance with the tax system and encourage Malaysian taxpayers to pay the entire tax liability to achieve the growth of Malaysia (Sapiei et al., 2014). Certain individuals make every effort to evade the tax liability or understate the income earned in a tax year (Youde & Lim, 2019). ...
... To gauge tax morale, five items were taken from Alasfour et al. (2016), while for fairness perception, the questions were adapted from the work of Taofeeq (2018). Next, tax awareness was estimated with six question items taken from Noor Azmi et al. (2020), whereas tax complexity was assessed with five items from Sapiei et al. (2014) and Saad (2012). Lastly, the tax penalty was estimated using five items from Loo (2016). ...
The tax system provides the necessary financial resources to a country’s administration to use the collected resources for the welfare of the general public and the development of general infrastructure. Therefore, compliance with the prevailing tax system is necessary for a country’s political and administrative system to survive. The current study aims to explore the intention to comply and the compliance behavior toward the tax system among Malaysian taxpayers. The data were collected using the survey method, and quantitative data were analyzed using the dual-stage methods of partial least squares structural equation modeling (PLS-SEM) and artificial neural network (ANN). The analysis results showed that the perceived fairness of the tax system, tax penalties, and tax awareness were significantly related to the intention to comply with the tax rules and regulations. Furthermore, the intention to comply with the tax system significantly influenced tax compliance behavior. The ANN analysis confirms that tax awareness, tax penalties, and fairness perception are the three most important factors influencing tax compliance. The tax authorities need to build the taxpayers’ confidence in the prevailing tax system and streamline the tax system to reduce tax complexity. Consequently, the taxpayers will start paying the correct and timely tax liabilities. The study’s limitations and future research avenues are documented at the end of this paper.
