scholarly journals Influence of Cost of Tax Compliance on Tax Compliance Among Investors in The Export Processing Zones in Kenya.

2018 ◽  
Vol 6 (10) ◽  
Author(s):  
Obongo Matibe Bernard ◽  
Dr. Florence S. Memba ◽  
Dr. Oluoch Oluoch
Keyword(s):  
Tax Compliance ◽  
Indirect Costs ◽  
Primary Data ◽  
Cross Sectional Survey ◽  
Export Processing Zones ◽  
Compliance Cost ◽  
Compliance Costs ◽  
Record Keeping ◽  
The Cost ◽  
Export Processing

The objective of this study was to establish the influence of cost of tax compliance on tax compliance among the Export Processing Zones investors in Kenya. This research used a cross sectional survey research design. The study population comprised of 152 duly registered and licensed firms by the Export Processing Zones Authority.  Since all the registered investors in the three Kenyan Cities were considered for the study, a census sampling technique was employed. Primary data was gathered using structured questionnaires and captured through a 5-point type Likert Scale questionnaire. Statistical Package for Social Sciences (SPSS) was used in the analysis of data. Data was analyzed by use of descriptive and inferential statistics. Analysis of Variance (ANOVA), multiple regression and correlation analysis was carried out to test the hypothesis. The study findings indicated that the cost of tax compliance influenced tax compliance to a great extent with a mean score of 4.02. This implies that tax compliance cost is a key determinant of tax compliance. Tax compliance costs play a key role in determining the level of a firm’s tax compliance. These costs include both direct and indirect costs such as auditing costs, costs of hiring tax personnel, agents & experts, time taken to complete tax assessment & returns filing as well as the accessing, employing and retaining knowledgeable staff; all for purposes of tax compliance. The study concludes that the cost of tax compliance is statistically significant in explaining tax compliance. The findings imply that taxpayers will comply more when tax compliance costs are lower and tax systems adequately simplified. The study recommends that governments and revenue authorities need to actively engage business enterprises through regular sensitizations on proper record keeping. Proper record keeping will facilitate; simplified tax preparations, returns filing, advance knowledge on tax laws and regulations as well as tax payments. Sensitization on basic tax calculation procedures is also key in the reduction of indirect costs associated with tax compliance.   Key Words: Tax compliance, Cost of Tax Compliance, Export Processing Zones.

scholarly journals Influence of Tax Knowledge and Awareness on Tax Compliance Among Investors in the Export Processing Zones in Kenya

2018 ◽  
Vol 6 (10) ◽  
Author(s):  
Obongo Matibe Bernard ◽  
Dr. Florence S. Memba ◽  
Dr. Oluoch Oluoch
Keyword(s):  
Public Awareness ◽  
Tax Compliance ◽  
Primary Data ◽  
Cross Sectional Survey ◽  
Export Processing Zones ◽  
Cross Sectional ◽  
The Public ◽  
Awareness Campaigns ◽  
Laws And Regulations ◽  
Export Processing

The objective of this study was to examine the influence of tax knowledge & awareness on tax compliance among Export Processing Zones investors in Kenya. This research used a cross sectional survey research design. The study population comprised of 152 duly registered and licensed firms by the Export Processing Zones Authority.  Since all the registered investors in the three Kenyan Cities were considered for the study, a census sampling technique was employed. Primary data was gathered using structured questionnaires and captured through a 5-point type Likert Scale questionnaire. Statistical Package for Social Sciences (SPSS) was used in the analysis of data. Data was analyzed by use of descriptive and inferential statistics. Analysis of Variance (ANOVA), multiple regression and correlation analysis was carried out to test the hypothesis. The study established that a significant number of organizations put emphasis on employee training geared at improving their tax knowledge and awareness, thus facilitating tax compliance. The study findings revealed that tax knowledge & awareness has a very close relationship with taxpayers’ ability to understand the laws and regulations of taxation, and their ability to comply with them. It was therefore possible to conclude that firms with well-trained employees on tax issues had a high likelihood of complying voluntarily with tax laws and regulations. The study also led to a conclusion that tax knowledge and awareness had a positive and significant relationship with tax compliance. The study recommends that the Revenue Authorities should embark on public awareness campaigns to educate the public and investors on their role and responsibilities in taxation rather than approaching the matter from a legal obligation perspective. This will create a sense of responsibility in compliance rather than fear for non-compliance. Putting in place active customer oriented information desks as well as client feedback mechanisms is also a necessary tool of increasing tax compliance. Further, more robust measures should be adopted in educating the public and investors on the tax issues and policies through regular training programmes, media advertisements, workshops and seminars.     Key Words: Tax Compliance, Tax Knowledge & Awareness, Export Processing Zones

scholarly journals Transaction Cost on The Implementation of E-Invoices in Micro and Small Enterprises

2017 ◽  
Vol 6 (1) ◽  
pp. 139-158
Author(s):  
Clara Palupi ◽  
Darwanto Darwanto
Keyword(s):  
Tax Compliance ◽  
Small Enterprises ◽  
Case Study Method ◽  
Compliance Cost ◽  
Compliance Costs ◽  
Micro And Small Enterprises ◽  
One Year ◽  
The Cost ◽  
Total Compliance

E-invoice is one of the tax administration modernization program created to reduce the tax compliance costs in order to improve the tax compliance. This paper aims to prove that e-invoice as a form of institutional change can actually change or lower the tax compliance costs. Using a qualitative approach case study method and supported by evidence of calculation of the cost of compliance. The results showed that e-invoice cannot directly reduce the tax compliance costs, because e-invoice is a new program and the taxpayers bear big the amount of time cost for the process of adjustment (adapt). Tax compliance costs will increase temporarily during the adaptation process; the total compliance cost in the six months after the e-invoice increased 3.4 percent from the six months before. Then, the results of tax compliance costs estimated at one year after the e-invoice applied showed that the compliance costs decrease 31 percent from the cost of compliance without e-invoice.DOI: 10.15408/sjie.v6i1.4866

Administrative and Compliance Costs of Value Added Tax (VAT): A Review

2021 ◽  
pp. 097226612110588
Author(s):  
S. Vishnuhadevi
Keyword(s):  
Small Businesses ◽  
Tax Compliance ◽  
Value Added ◽  
Operating Costs ◽  
Tax Revenue ◽  
Compliance Cost ◽  
Compliance Costs ◽  
Factors Associated ◽  
Administrative Costs ◽  
Decision Factors

This article surveys the existing literature on the compliance and administrative costs of VAT incurred by the businesses and the governments respectively. The review focuses on the concepts and components of VAT operating costs, the link between the tax compliance costs and the tax compliance decision, factors associated with compliance costs and the steps taken by various countries to mitigate these costs. The major studies of VAT compliance cost since 1980 and the methodologies adopted are summarised. The review of the studies shows that the VAT compliance costs are higher and significant in both absolute money terms and relative to tax revenue in developed as well as developing countries than the administrative costs and the compliance costs are highly regressive in nature which disproportionately affects the small businesses. Further, the psychological costs are underexplored in the VAT compliance cost literature due to the difficulty in measuring them. This article also highlights the understudied area of VAT compliance costs in India and the importance of exploring the compliance burden in India.

scholarly journals Addressing the small business tax compliance burden: Evidence from South Africa

2013 ◽  
Vol 6 (2) ◽  
pp. 263-284
Author(s):  
Sharon Smulders ◽  
Gelishan Naidoo
Keyword(s):  
South Africa ◽  
Small Business ◽  
South African ◽  
Small Businesses ◽  
Tax Compliance ◽  
Compliance Cost ◽  
Record Keeping ◽  
Business Tax ◽  
Cost Studies ◽  
First Time

Small businesses have the potential to grow the economy, generate jobs and reduce poverty, but they face many constraints including high tax compliance costs and burdens. A comparison of the findings and recommendations made in small business tax compliance cost studies conducted in South Africa with initiatives introduced by the South African Revenue Service (SARS), substantiated by consultations with a SARS and a South African Institute of Chartered Accountants official, reveals that SARS has, in most cases, attempted to address the tax compliance burdens identified in these studies. However, SARS has only partially addressed the complexity of the tax law, the lack of software to assist small businesses with their record-keeping and the compliance burden associated with provisional tax. SARS has failed to address the need for a threshold below which no small business tax return is required to be submitted, the inclusion of tax in the school syllabus, the requirement for first-time offenders to attend courses instead of raising penalties and the need for a reduction in the rates of interest and penalties raised by SARS. These initiatives should be considered by SARS and it is recommended that further research into the success and effectiveness of all the initiatives already introduced by SARS be performed.

scholarly journals Pengaruh Penerapan E-Filing Dan Pengetahuan Perpajakan Terhadap Kepatuhan Wajib Pajak Dengan Biaya Kepatuhan Sebagai Variabel Moderasi

2019 ◽  
Vol 1 (3) ◽  
pp. 1510-1517
Author(s):  
M. Ardhy Erwanda ◽  
Henri Agustin ◽  
Erly Mulyani
Keyword(s):  
Regression Analysis ◽  
Sampling Method ◽  
Primary Data ◽  
Significant Positive Effect ◽  
Compliance Costs ◽  
Analysis Technique ◽  
The Cost ◽  
Relationship Of ◽  
The Relationship ◽  
Positive Effect

This study aims to determine the effect of applying e-filing and knowledge of taxation on taxpayer compliance. Compliance costs as moderating variable that moderate relations between application e-filing and knowledge taxation on the taxpayer compliance. The population in this study is taxpayers in Padang city. The number off samples used was 100 respondents with the sampling method using purposive sampling. The data used in this study are primary data. Data collection techniques are done by questionnaire. The data analysis technique used is multiple regression and moderated regression analysis. The results obtained are the application of e-filing has a significant positive effect on taxpayer compliance, knowledge of taxation does not affect taxpayer compliance, compliance costs proved to moderate the relationship between the implementation of e-filing and taxpayer compliance, and the cost of compliance was not proven to moderate the knowledge relationship of taxation with taxpayer compliance

scholarly journals Addressing the small business tax compliance burden: Evidence from South Africa

2013 ◽  
Vol 6 (1) ◽  
pp. 33-54 ◽  
Author(s):  
Sharon Smulders ◽  
Gelishan Naidoo
Keyword(s):  
South Africa ◽  
Small Business ◽  
South African ◽  
Small Businesses ◽  
Tax Compliance ◽  
Compliance Cost ◽  
Record Keeping ◽  
Business Tax ◽  
Cost Studies ◽  
First Time

Small businesses have the potential to grow the economy, generate jobs and reduce poverty, but they face many constraints including high tax compliance costs and burdens. A comparison of the findings and recommendations made in small business tax compliance cost studies conducted in South Africa with initiatives introduced by the South African Revenue Service (SARS), substantiated by consultations with a SARS and a South African Institute of Chartered Accountants official, reveals that SARS has, in most cases, attempted to address the tax compliance burdens identified in these studies. However, SARS has only partially addressed the complexity of the tax law, the lack of software to assist small businesses with their record-keeping and the compliance burden associated with provisional tax. SARS has failed to address the need for a threshold below which no small business tax return is required to be submitted, the inclusion of tax in the school syllabus, the requirement for first-time offenders to attend courses instead of raising penalties and the need for a reduction in the rates of interest and penalties raised by SARS. These initiatives should be considered by SARS and it is recommended that further research into the success and effectiveness of all the initiatives already introduced by SARS be performed.

scholarly journals Income Tax Compliance Cost of Corporations in India, 2000–01

2006 ◽  
Vol 31 (4) ◽  
pp. 9-30
Author(s):  
Arindam Das-Gupta
Keyword(s):  
Cash Flow ◽  
Tax Evasion ◽  
Income Tax ◽  
Tax Compliance ◽  
Postal Survey ◽  
Legal Compliance ◽  
Compliance Cost ◽  
Convenience Sample ◽  
Compliance Costs ◽  
Corporation Tax

This is the first study of compliance costs of income taxation of corporations in India. Compliance costs are the costs of meeting obligations under the income tax law and in planning to save taxes. Opportunity costs such as when tax refunds are delayed are also included. Social compliance costs, gross versus net private costs, and mandatory versus voluntary cost can be distinguished. Gross private compliance costs include both legal and illegal expenses (such as bribes paid), employee costs, the cost of tax advice, and also other non-labour expenses. Estimates in this paper are for the year 2000-01 based on a postal survey of 45 companies throughout India in August-September 2001. Estimated gross compliance costs, excluding bribe costs, are between 5.6 and 14.5 per cent of corporation tax revenues. These are similar to estimates for other countries near the lower limit but are a cause for concern near the upper limit. Tax deductibility of legal expenses and cash flow benefits from the timing difference between taxable income and payment of tax result in net compliance costs between minus 0.7 and plus 0.6 per cent of corporation tax revenue. Both gross and net compliance costs are regressive. Among other findings, five are noteworthy: First, around 25 per cent of sampled companies knowingly paid excess tax (median value: 46%) since tax evasion penalty cannot be levied under Indian law if assessed taxes have already been paid. Second, 70 per cent of companies, especially small companies, used external assistance to prepare tax returns accounting for 39 per cent of the legal compliance costs. Third, voluntary costs associated with tax planning contribute 19 to 43 per cent of total compliance costs. Fourth, the average sample company had 10 to 11 assessment years locked in disputes for tax or penalty in addition to around two years for which assessments were incomplete. Statistical analysis suggested that one extra disputed assessment year raises legal compliance costs by 5.7 per cent. Fifth, it was found to be fairly common for incorrect application of tax laws by tax officials in areas where they have high discretion to cause tax assessments to be revisited. Among reform suggestions is streamlining of 22 legal and procedural �hot spots� which add to compliance costs. Since the response rate was a disappointing 1.15 per cent, the stratified random sample design degenerated into a convenience sample with over-representation of large firms and under-representation of loss-making and zero-profit companies. Therefore, results should be viewed as preliminary and tentative. Other problems are that there were only qualitative questions about in-house cost components; assumed opportunity cost of funds to value cash flow benefits were used; and, as in earlier studies, there can possibly be a bias due to incorrect apportionment of fixed costs and the value of time of company management

Socio-demographics of tax stamp compliance in Upper Denkyira East Municipal and Upper Denkyira West District in Ghana

2017 ◽  
Vol 59 (6) ◽  
pp. 1315-1330 ◽  
Author(s):  
Stephen Amponsah ◽  
Kofi Osei Adu
Keyword(s):  
Survey Design ◽  
Tax Compliance ◽  
Demographic Factors ◽  
Special Kind ◽  
Sampling Technique ◽  
Structured Interview ◽  
Primary Data ◽  
Cross Sectional Survey ◽  
Cross Sectional ◽  
Content Type

Purpose The purpose of the study is to analyse social and demographic factors that affect tax stamp compliance in Upper Denkyira East Municipal and Upper Denkyira West District in Ghana. Design/methodology/approach The study adopted a cross-sectional survey design to sample 783 micro-taxpayers through the use of multi-stage sampling technique. Primary data were collected from micro-taxpayers by using a structured interview. Ordered logit regression model was used to regress the extent of tax stamp compliance on socio-demographic factors in relation to tax stamp cases in the study area. Findings The study found that occupational association status, location, gender, type of business operated, age, level of education and household size are significant predictors of tax stamp compliance in the study area. Originality/value The originality of the study is in twofold. First, the study dwells on extant literature on social and demographic factors of tax compliance in general and specifically applies them to a special kind of presumptive tax, tax stamp, in Ghana. The study is also considered as the first of its kind to perform rigorous statistical analysis of social and demographic factors in relation to tax compliance.

Estimation of the cost of MS in Europe: Extrapolations from a multinational cost study

2007 ◽  
Vol 13 (8) ◽  
pp. 1054-1064 ◽  
Author(s):  
P. Sobocki ◽  
M. Pugliatti ◽  
K. Lauer ◽  
G. Kobelt
Keyword(s):  
Annual Cost ◽  
Indirect Costs ◽  
Epidemiological Data ◽  
Cost Data ◽  
Primary Data ◽  
Total Annual Cost ◽  
Cost Study ◽  
Total Cost ◽  
Prevalence Estimates ◽  
The Cost

The present study aims at estimating the total cost of MS in Europe based on actual cost data from nine countries and published epidemiological evidence. The epidemiological data are reported as 12 months prevalence estimates and cost data calculated as annual cost per patient at given levels of disease severity. Cost data are extrapolated to the rest of Europe based on a model, using economic indexes adjusting for price level differences in different sectors between countries. The aggregated annual cost estimates are presented in Euro for 2005. In 28 European countries with a population of 466 million, an estimated 380 000 individuals are affected by MS. The total annual cost of MS in Europe is estimated at 12.5 billion in year 2005, corresponding to a cost of 27 per European inhabitant. Direct costs represent slightly more than half of the total cost (6.0 billion). Informal care is estimated at 3.2 billion, and indirect costs due to morbidity at 3.2 billion. Thus, the largest component of costs is found outside the formal health care sector. Although our model appears to predict costs reasonably well, when comparing to previous national studies not included in the estimates, there are considerable uncertainties when extrapolating cost data across countries even within Europe. These weaknesses can only be overcome by collecting primary data. Multiple Sclerosis 2007; 13: 1054—1064. http://msj.sagepub.com

Moderating influence of religiosity on the causality between taxpaying attitudes and tax compliance behaviour of entrepreneurial firms in Nigeria

2022 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Lateef Ayodele Agbetunde ◽  
Lukman Raimi ◽  
Olalekan Oladipo Akinrinola
Keyword(s):  
Tax Evasion ◽  
Tax Compliance ◽  
Policy Implications ◽  
Primary Data ◽  
Entrepreneurial Firms ◽  
Linear Regression Models ◽  
Cross Sectional Survey ◽  
Cross Sectional ◽  
Content Type ◽  
Compliance Behaviour

Purpose This paper aims to investigate the moderating influence of religiosity on the effect of taxpaying attitudes on the tax compliance behaviour of entrepreneurial firms in Nigeria. Design/methodology/approach Using a cross-sectional survey design, we collected primary data from 368 owner managers of entrepreneurial firms in Southwest Nigeria using structured questionnaires. Respondents were purposefully selected based on the purposive sampling technique. The data collected with the structured questionnaires were analysed using descriptive and inferential statistics. Two linear regression models were compared. Findings Estimations in Models 1 and 2 suggest that taxpayers’ attitudes and religiosity (intra- and interreligiosity) have significant effects on the tax compliance behaviour of firms, but the influence of intrareligiosity is insignificant. Estimations in Model 3 suggest that taxpaying attitudes without the moderating influence of religiosity exerted a significant effect on tax compliance behaviour by 13%, while taxpaying attitudes with the moderating influence of religiosity exerted 17%. Estimations in Model 4 suggest that taxpaying attitudes with the moderating influence of the interreligiosity dimension had a more significant contribution to the changes in tax compliance behaviour than the intrareligious dimension. Research limitations/implications From the findings, the following policy implications can be deduced: (i) if taxpayers’ attitudes improved and religiosity was leveraged by the tax authorities, tax compliance behaviour of entrepreneurial firms would be induced in Nigeria; (ii) the consistent positive influence is a strong indication that religious values are critical elements of tax compliance interventions that should be considered by policymakers when designing public policies on tax evasion and avoidance in developing countries. Originality/value We bridge the gaps in the literature because our study affirmed that taxes are religiously driven. In addition, the study validates the applicability of theory of planned behaviour in investigating the moderating influence of religiosity on the causality between taxpaying attitude and tax compliance in the developing context.

Sign in / Sign up

Export Citation Format

Share Document