Improving Tax Compliance Intentions and Self-Assessment System: Approach to the Theory of Planned Behavior

Abstract

Tax compliance is a cornerstone of the social contract, whereby citizens get government services in exchange for monetary contributions, and hence, it is essential for the government to maintain fiscal stability. This research intends to measure taxpayers' willingness and ability to accurately self-report their compliance with tax legislation by investigating the taxpayer's perspective through attitude, subjective norms, and behavioral control. Structural Equation Modeling (SEM) was combined with Partial Least Square (PLS) analysis and snowball sampling for the data processing. The sample for this research consisted of 430 individual taxpayers in Indonesia’s Banten Province. The results show that attitudes, subjective norms, and perceived behavioral control affect taxpayers’ compliance intentions and the self-assessment system. The self-assessment system is an additional factor that indirectly influences compliance intentions. The study establishes a fundamental framework for gaining a more profound understanding of tax compliance intentions and can serve as the groundwork for future investigations aimed at constructing more advanced models and theories to elucidate tax compliance intentions. These findings can assist countries in developing more efficient tax policies to enhance taxpayer compliance and optimize the tax system to maximize tax collections.