shopping_cart

Your shopping cart is empty

What’s in it for me? The potential for managerial benefits to improve tax compliance

Member Price: $35.00
Non Member Price: $45.00

DisclaimerThis material is copyright. Apart from any fair dealing for the purposes of private study, research, criticism or review, as permitted under the Copyright Act, no part may be reproduced by any process without written permission from The Tax Institute.
Unless expressly stated, opinions are not that of The Tax Institute, which accepts no responsibility for the accuracy of any of the information contained within it.

Published on 01 Jul 18 by "AUSTRALIAN TAX FORUM" JOURNAL ARTICLE

A value-added tax (VAT) may induce businesses to make a clear decision as to operating outside the formal economy, with the VAT seen as a real cost. It is suggested that small and medium enterprises (SMEs) are more likely to contribute to the cash economy, so it is important to have a greater understanding of the factors that may make SMEs more tax compliant, especially with VAT. Potential motivators for complying with a VAT are the managerial benefits that arise from keeping tax records.

This article reports the findings from a survey of 240 SMEs in a developing country, with the findings suggesting that for non-compliant taxpayers, being aware of the potential managerial benefits from complying with VAT appears to be more persuasive than the imposition of penalties. In this way, compliance may be improved if taxpayers see "what’s in it for me" in terms of complying with a country’s VAT system.

 

Author profiles

Nahida Faridy
Nahida works for Department of Accounting, Finance and Economics, Griffith Business School, Griffith University.
  • Current at 1 May 2014
    • Click here to expand/collapse more articles by Nahida Faridy.
    Dr Brett Freudenberg CTA
    Brett is a Professor – Taxation at Griffith University. Brett is known for his research expertise in the tax law and policy issues facing private enterprises, as evidenced by his Fulbright Scholarship (2006) and over 80 refereed publications in leading Australian and international journals. In 2020, he was awarded the national ATTA-Hill medal in recognition of outstanding contribution to Australasian tax policy and tax teaching. Brett is passionate about education being a transformative process, and his effectiveness as a teacher has been recognised through five national awards (including the award of two Australian Learning and Teaching Council citations: 2008 & 2011). In 2019 Brett was successful in securing funding from the Federal Government to establish the Griffith Tax Clinic, which sees students under supervision providing free tax assistance to those in need in the community. Prior to commencing with Griffith University, Brett was a senior taxation consultant with KPMG and a solicitor with Corrs Chambers. - Current at 06 July 2022
    Click here to expand/collapse more articles by Brett Freudenberg.
    Tapan Sarker
    Tapan works for Department of International Business & Asian Studies, Griffith Business School, Griffith University.
    Current at 1 May 2014
    Click here to expand/collapse more articles by Tapan Sarker.

     

    Copyright Statement