Factors Affecting Enforced Tax Compliance of Businesses in Vietnam

Abstract

The objective of this study is to test 11 factors including Social Norms, Tax Education, Coercive Power of Tax Authority, Legitimate Power of Tax Authority, Tax Information, Tax Penalty, Tax Audit, Tax Rate, Tax Compliance Costs, Service Quality of Tax Authority, Public Governance Quality affecting the enforced tax compliance of businesses in Ho Chi Minh City, Vietnam. The study uses a data collection tool which is a questionnaire with survey subjects who are accountants, chief accountants, and financial directors of businesses in Ho Chi Minh City, Vietnam. The author uses Structural equation modeling to test the hypotheses in the research model. The research results found that there are 5 factors that have a significant influence on the enforced tax compliance of businesses in Ho Chi Minh City, Vietnam. They are Legitimate Power of Tax Authority, Service Quality of Tax Authority, Tax Information, Coercive Power of Tax Authority, and Tax Education, and the remaining 6 factors do not affect the enforced tax compliance of the businesses industry in Ho Chi Minh City, Vietnam. Policymakers, tax authorities, and other stakeholders based on this research can come up with more appropriate solutions to enhance the enforced tax compliance behavior of businesses.