Tax Compliance Behaviour of Individuals under Self Assessment System

Tax non-compliance has always been a major concern for all tax administrations, more so in a self assessment environment where it is dependent on voluntary compliance. In Malaysia, there is a dearth of empirical research on tax compliance in relation to the implementation of self assessment which...

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Main Author:	Sia, Gioak Faa
Format:	Thesis
Language:	English English
Published:	2008
Subjects:	Taxpayer compliance - Malaysia. Tax assessment - Malaysia.
Online Access:	http://psasir.upm.edu.my/id/eprint/6927/1/GSM_2008_8.pdf
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id	my-upm-ir.6927
record_format	uketd_dc
spelling	my-upm-ir.69272023-11-21T03:21:38Z Tax Compliance Behaviour of Individuals under Self Assessment System 2008-08 Sia, Gioak Faa Tax non-compliance has always been a major concern for all tax administrations, more so in a self assessment environment where it is dependent on voluntary compliance. In Malaysia, there is a dearth of empirical research on tax compliance in relation to the implementation of self assessment which only began in 2001 for corporations and 2004 for individual taxpayers. One of the objectives for implementing self assessment is to increase voluntary tax compliance. As such, in a tax system based largely on voluntary compliance, understanding factors that affect compliance amongst individual taxpayers is of vital importance. This thesis integrates two important approaches, namely, the economic and behavioral approaches in examining factors affecting tax compliance. The factors examined include perceived probability of detection, prior tax audit, sanction perception, perception of fairness, perceived moral intensity and peer influence. The data for this study were gathered by using a mail survey. Descriptive analysis and multivariate analysis were performed on the data to determine how the above mentioned factors affect tax compliance behavior. The findings showed that four factors, namely, perceived probability of detection, sanction perception, perceived moral intensity and peer influence were found to have significa~t relationships with tax compliance. On the other hand, perception of fairness and prior tax audit were found to have insignificant relationships with tax compliance. However, even though prior tax audit did not have a direct effect on tax compliance, it was found to be significantly associated with perceived probability of detection which is significantly related to tax compliance. This implies that prior tax audit has an indirect effect on tax compliance. Apart from prior tax audit affecting perceived probability of detection, another factor examined namely sanction perception was found to affect perceived probability of detection. In relation to perceived probability of detection and perceived moral intensity which had significant relationships with tax compliance respectively, the findings also indicated that both perceived probability of detection and perceived moral intensity had significant relationships with perception of fairness. Understanding these relationships is important as it not only extends knowledge on improving tax compliance but also provides useful information for the revenue collection authorities in designing better tax policies. Taxpayer compliance - Malaysia. Tax assessment - Malaysia. 2008-08 Thesis http://psasir.upm.edu.my/id/eprint/6927/ http://psasir.upm.edu.my/id/eprint/6927/1/GSM_2008_8.pdf text en public doctoral Universiti Putra Malaysia Taxpayer compliance - Malaysia. Tax assessment - Malaysia. Graduate School of Management Salleh, Arfah English
institution	Universiti Putra Malaysia
collection	PSAS Institutional Repository
language	English English
advisor	Salleh, Arfah
topic	Taxpayer compliance - Malaysia. Tax assessment - Malaysia.
spellingShingle	Taxpayer compliance - Malaysia. Tax assessment - Malaysia. Sia, Gioak Faa Tax Compliance Behaviour of Individuals under Self Assessment System
description	Tax non-compliance has always been a major concern for all tax administrations, more so in a self assessment environment where it is dependent on voluntary compliance. In Malaysia, there is a dearth of empirical research on tax compliance in relation to the implementation of self assessment which only began in 2001 for corporations and 2004 for individual taxpayers. One of the objectives for implementing self assessment is to increase voluntary tax compliance. As such, in a tax system based largely on voluntary compliance, understanding factors that affect compliance amongst individual taxpayers is of vital importance. This thesis integrates two important approaches, namely, the economic and behavioral approaches in examining factors affecting tax compliance. The factors examined include perceived probability of detection, prior tax audit, sanction perception, perception of fairness, perceived moral intensity and peer influence. The data for this study were gathered by using a mail survey. Descriptive analysis and multivariate analysis were performed on the data to determine how the above mentioned factors affect tax compliance behavior. The findings showed that four factors, namely, perceived probability of detection, sanction perception, perceived moral intensity and peer influence were found to have significa~t relationships with tax compliance. On the other hand, perception of fairness and prior tax audit were found to have insignificant relationships with tax compliance. However, even though prior tax audit did not have a direct effect on tax compliance, it was found to be significantly associated with perceived probability of detection which is significantly related to tax compliance. This implies that prior tax audit has an indirect effect on tax compliance. Apart from prior tax audit affecting perceived probability of detection, another factor examined namely sanction perception was found to affect perceived probability of detection. In relation to perceived probability of detection and perceived moral intensity which had significant relationships with tax compliance respectively, the findings also indicated that both perceived probability of detection and perceived moral intensity had significant relationships with perception of fairness. Understanding these relationships is important as it not only extends knowledge on improving tax compliance but also provides useful information for the revenue collection authorities in designing better tax policies.
format	Thesis
qualification_level	Doctorate
author	Sia, Gioak Faa
author_facet	Sia, Gioak Faa
author_sort	Sia, Gioak Faa
title	Tax Compliance Behaviour of Individuals under Self Assessment System
title_short	Tax Compliance Behaviour of Individuals under Self Assessment System
title_full	Tax Compliance Behaviour of Individuals under Self Assessment System
title_fullStr	Tax Compliance Behaviour of Individuals under Self Assessment System
title_full_unstemmed	Tax Compliance Behaviour of Individuals under Self Assessment System
title_sort	tax compliance behaviour of individuals under self assessment system
granting_institution	Universiti Putra Malaysia
granting_department	Graduate School of Management
publishDate	2008
url	http://psasir.upm.edu.my/id/eprint/6927/1/GSM_2008_8.pdf
_version_	1794018694930628608

Tax Compliance Behaviour of Individuals under Self Assessment System

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