Thesis (M.M. (Public and Development Management))--University of the Witwatersrand, Faculty of Commerce, Law and Management, Graduate School of Public and Development Management, 2014. / Microenterprises have the potential to address the triple challenges of unemployment, poverty and inequality because of the opportunities they present to the socially and economically disadvantaged in South Africa. This has a spillover effect of growing the economy. However, the challenges faced by tax compliant microenterprises as uncovered in this qualitative research, limits them in meeting potential. Twelve respondents comprising of three clusters (tax practitioners, microenterprise owners and SARS official) were purposefully and conveniently sampled to give their views and opinions about the challenges. The lack of expertise, SARS' evolving rules and regulations, financial costs of being compliant, onerous tax compliance preparations, and constitutional ambiguity and unclear definition of microenterprises were observed to be the major challenges that tax compliant microenterprises face. Although the South African government is not oblivious of the dilemma that tax compliant microenterprises often find themselves in, more needs to be done to ease their plight in operating in an enabling business environment. This study provides an insight into the current and future tax issues that government needs to address towards creating an enabling tax environment for businesses. The scope of this paper is limited as the researcher sought to bring to light the challenges faced by microenterprises. Other emerging issues, such as the benefits of being compliant could not be fully established and paves the way for further research.

This study contributes to the body of knowledge on tax compliance costs to small businesses by pioneering research in South Africa on four fronts. Firstly, the study is the first to comprehensively quantify small business tax compliance costs – establishing a baseline against which future research can be benchmarked. Secondly, the study established that small businesses perceive tax compliance benefits to exist, but found that the respondents were generally unable to quantify them. Thirdly, it evaluated the perceived impact of the major small business tax concessions on the level of tax compliance costs incurred by small businesses. Finally, the study used regression analyses to evaluate the drivers or determinants of internal and external tax compliance costs. / Thesis (PhD)--University of Pretroia, 2013 / lk2014 / Taxation / unrestricted

Recent accounting scandals and current global financial crisis have brought new demands on the whole corporate world. The call for better corporate governance is strengthening in all business areas including tax. Tax non -- compliance brings substantial risks for both tax payers and tax revenue authorities. The way how companies manage their tax risks can significantly influence their overall financial performance and reputation. The paper deals with issues of tax non -- compliance as a lack of good corporate governance practice. The main goal of the paper is to put tax into the concept of corporate governance. Moreover, the paper deals with the concept of tax risk management as a way of how tax compliance in general could be enhanced and introduces the current international practice in this field.

Tax authorities utilize a wide range of instruments to motivate honest taxpaying ranging from strict audits to fair procedures or personalized support, differing from country to country. However, little is known about how these different instruments and taxpayers' trust influence the generation of interaction climates between tax authorities and taxpayers, motivations to comply, and particularly, tax compliance. The present research examines the extended slippery slope framework (eSSF), which distinguishes tax authorities' instruments into different qualities of power of authority (coercive and legitimate) and trust in authorities (reasonbased and implicit), to shed light on the effect of differences between power and trust. We test eSSF assumptions with survey data from taxpayers from three culturally different countries (N = 700) who also vary concerning their perceptions of power, trust, interaction climates, and tax motivations. Results support assumptions of the eSSF. Across all countries, the relation of coercive power and tax compliance was mediated by implicit trust, which leads to an antagonistic climate and enforced motivation. The connection from legitimate power to tax compliance is partially mediated by reason-based trust. The relationship between implicit trust and tax compliance is mediated by a confidence climate and committed cooperation. Theoretical and practical implications are discussed.

Prior tax compliance literature has examined the use of persuasive messages that emphasize audit and sanctions as a way to increase compliance. This work has been done in single period experiments using either survey or field study methodologies. Results from the prior studies are mixed. The theory of reasoned action is a theory of social behavior that promotes emphasizing direct consequences of actions to motivate specific behavior. Persuasive messages based on this theory have been found to be effective in a number of different disciplines. The theory of reasoned action has been used in the field of tax compliance to explain compliance behavior and examine the behavioral beliefs related to compliant reporting, but has not been used to design persuasive messages aimed at increasing compliance. In this dissertation, I conduct a laboratory experiment that examines the effects of two types of messages - a traditional message consisting of a simple reminder of audit risk and a message designed based on the theory of reasoned action. Consistent with prior research on tax compliance, I test the messages in an initial single period but I extend prior research by also examining the effects of the messages over repeated periods. Neither the traditional message nor the message based on the theory of reasoned action have a significant effect on initial period compliance. The interaction effect of the traditional message and time on tax compliance is positive and significant and the interaction effect of the theory of reasoned action message and time on tax compliance is positive and marginally significant. These results provide evidence that the messages may be effective in increasing an individual's tax compliance over time. In the repeated period data, the theory of reasoned action message exhibits a positive and significant impact on the amount of income reported when an individual reports less than 100% of their earned income, providing evidence that messages designed based on the theory of reasoned action may be an effective tool in reducing the tax gap. / Ph. D.

As mudanças advindas com a popularização da tecnologia, com maior agudez no ambiente corporativo, associadas à assimetria informacional existente entre os contribuintes e as autoridades fiscais, ganharam novos contornos com a implementação do projeto SPED. Tal projeto trouxe em seu bojo a promessa de uma ferramenta com a capacidade de reduzir o tax gap, diferença entre o montante dos tributos devidos conforme a legislação e os tempestivamente recolhidos pelos contribuintes, em um ambiente saturado pela alta carga tributária e que, concomitantemente, atravessa um período de crise política e econômica. Neste cenário, os esforços das autoridades fiscais para a redução do tax gap tornam-se essenciais para que haja um maior volume arrecadatório sem que haja a criação de novos tributos. Diferentemente da maior parte dos estudos efetuados para análise do tax gap, este trabalho concentrou-se na análise de um tributo sobre o valor adicionado, o ICMS, tributo mais representativo do Produto Interno Bruto brasileiro. Nesse contexto, o objetivo deste estudo concentrou-se em avaliar como a influência das inovações técnicas e gerenciais introduzidas pelo projeto SPED impactou o tax gap do ICMS no Estado de São Paulo, sob a ótica dos agentes fiscalizadores. A partir da revisão da literatura e de sua análise exploratória foi desenvolvido o modelo teórico, testado pela técnica de modelagem de equações estruturais PLS-SEM. Os resultados mostraram que houve uma influência significativa dos determinantes do tax gap apresentados na literatura e do SPED no tax gap do ICMS paulista, com ênfase para as fiscalizações mais ágeis e abrangentes, maior acesso às informações dos contribuintes, influência na decisão do contribuinte em reduzir a parcela dos valores a sonegar e a identificação daqueles que declaram valores menores que os devidos. Os resultados contribuem para o desenvolvimento teórico do tax gap dos VATs, uma vez testadas e confirmadas a influência dos seus determinantes e do projeto SPED. / The changes coming by the popularization of technology, with greater acuteness in the corporate environment, associated with the informational asymmetry existing between taxpayers and tax authorities, have gained new contours with the implementation of the SPED project. This project brought in its wake the promise of a tool with the capacity to reduce the tax gap, the difference between the amount of taxes due according to the legislation and those that have been collected by taxpayers in an environment saturated by the high tax burden and which, at the same time, period of political and economic crisis. In this context, the efforts of the tax authorities to reduce the tax gap are essential to a higher collection volume without the creation of new taxes. Unlike most of the studies carried out to analyze the tax gap, this work focused on the analysis of a value-added tax, the ICMS, the most representative tax of the Brazilian Gross Domestic Product. In this way, the objective of this study was to understand how the determinants of the tax gap and the SPED project have helped the São Paulo government to reduce informational asymmetry with taxpayers, from the point of view of tax authorities. From the literature review and its exploratory analysis, the theoretical model was developed, tested by the structural equation modeling technique PLS-SEM. The results showed that there was a significant influence of the determinants of the tax gap presented in the literature and SPED in the ICMS´s tax gap of São Paulo, with emphasis on the more agile and comprehensive inspections, greater access to taxpayers\' information, influence on the taxpayer\'s decision to reduce the portion of the amounts to be withheld and the identification of those that declare lower amounts than those due. The results contribute to the theoretical development of the tax gap of the VATs once they have been tested and confirmed the influence of their determinants and the SPED project.

As mudanças advindas com a popularização da tecnologia, com maior agudez no ambiente corporativo, associadas à assimetria informacional existente entre os contribuintes e as autoridades fiscais, ganharam novos contornos com a implementação do projeto SPED. Tal projeto trouxe em seu bojo a promessa de uma ferramenta com a capacidade de reduzir o tax gap, diferença entre o montante dos tributos devidos conforme a legislação e os tempestivamente recolhidos pelos contribuintes, em um ambiente saturado pela alta carga tributária e que, concomitantemente, atravessa um período de crise política e econômica. Neste cenário, os esforços das autoridades fiscais para a redução do tax gap tornam-se essenciais para que haja um maior volume arrecadatório sem que haja a criação de novos tributos. Diferentemente da maior parte dos estudos efetuados para análise do tax gap, este trabalho concentrou-se na análise de um tributo sobre o valor adicionado, o ICMS, tributo mais representativo do Produto Interno Bruto brasileiro. Nesse contexto, o objetivo deste estudo concentrou-se em avaliar como a influência das inovações técnicas e gerenciais introduzidas pelo projeto SPED impactou o tax gap do ICMS no Estado de São Paulo, sob a ótica dos agentes fiscalizadores. A partir da revisão da literatura e de sua análise exploratória foi desenvolvido o modelo teórico, testado pela técnica de modelagem de equações estruturais PLS-SEM. Os resultados mostraram que houve uma influência significativa dos determinantes do tax gap apresentados na literatura e do SPED no tax gap do ICMS paulista, com ênfase para as fiscalizações mais ágeis e abrangentes, maior acesso às informações dos contribuintes, influência na decisão do contribuinte em reduzir a parcela dos valores a sonegar e a identificação daqueles que declaram valores menores que os devidos. Os resultados contribuem para o desenvolvimento teórico do tax gap dos VATs, uma vez testadas e confirmadas a influência dos seus determinantes e do projeto SPED. / The changes coming by the popularization of technology, with greater acuteness in the corporate environment, associated with the informational asymmetry existing between taxpayers and tax authorities, have gained new contours with the implementation of the SPED project. This project brought in its wake the promise of a tool with the capacity to reduce the tax gap, the difference between the amount of taxes due according to the legislation and those that have been collected by taxpayers in an environment saturated by the high tax burden and which, at the same time, period of political and economic crisis. In this context, the efforts of the tax authorities to reduce the tax gap are essential to a higher collection volume without the creation of new taxes. Unlike most of the studies carried out to analyze the tax gap, this work focused on the analysis of a value-added tax, the ICMS, the most representative tax of the Brazilian Gross Domestic Product. In this way, the objective of this study was to understand how the determinants of the tax gap and the SPED project have helped the São Paulo government to reduce informational asymmetry with taxpayers, from the point of view of tax authorities. From the literature review and its exploratory analysis, the theoretical model was developed, tested by the structural equation modeling technique PLS-SEM. The results showed that there was a significant influence of the determinants of the tax gap presented in the literature and SPED in the ICMS´s tax gap of São Paulo, with emphasis on the more agile and comprehensive inspections, greater access to taxpayers\' information, influence on the taxpayer\'s decision to reduce the portion of the amounts to be withheld and the identification of those that declare lower amounts than those due. The results contribute to the theoretical development of the tax gap of the VATs once they have been tested and confirmed the influence of their determinants and the SPED project.

South Africa implemented a simplified Turnover Tax system with effect from the commencement of years of assessment 1 March 2009 in order to help improve the culture of tax compliance. To date the number of applicants has not been significant and a potential reason for this is that it is not fair. Fairness and equality within a tax system is important in order to discourage evasion. The purpose of this research is to explore the perceived fairness of the current Turnover Tax system. Using the principles of a fair tax system as advanced by Adam Smith (1776) a correspondence survey was issued to identify whether the Turnover Tax principles enhance or undermine fairness. The criticisms and provisions of the Sixth Schedule to the Income Tax Act No. 58 of 1962 were investigated to determine whether Adam Smith’s (1776) maxims are promoted or undermined and in turn whether they are perceived as being fair or not. Based on the responses and analysis of the survey, it was deduced that the Turnover Tax system is not being perceived as completely fair. As a result changes need to be implemented to in order to improve the overall compliance and effectiveness of the tax.

The implementation of Horizontal Monitoring (HM) in Austria represents a shift in the prevailing command-and-control paradigm towards enhanced cooperation between taxpayers and tax authorities. In the present paper, we assess how HM is perceived by different stakeholder groups when it was introduced as a pilot project embedded in the "Fair Play Initiative" launched by the Austrian Ministry of Finance. We collected quantitative and qualitative data from tax auditors and staff of tax offices responsible for large-scale enterprises who were either directly involved or not involved in the HM pilot project, from employees of participating enterprises as well as from employees of enterprises which did not participate in the project. Results show that representations of HM were most positive among employees from HM companies and tax officials directly involved, whereas participants from the tax administration who did not take part in the project were skeptical at the beginning and remained skeptical over time. As shown in organizational change studies, the acceptance or resistance regarding the paradigm change represented by HM may originate from uncertainty and misperceptions of its goals and strategies and from speculations, particularly by poorly informed members.

Issues and problems associated with the seriousness of tax non-compliance have increased dramatically over the years due to the widening tax gaps experienced by governments worldwide as a result of sophisticated transactions. To add to the severity of the situation are the concerns surrounding the difficulties associated with our abilities in defining what is meant by tax compliance, non-compliance and their relevant sub-categories. This study reviews both the international existing literature and New Zealand case law to examine how the concepts have (or have not) been defined over the years within particular studies and case law. The results are presented in the form of a critical literature review where the definitions (or descriptions) for the concepts are organized into tables, in order to compare how the definitions have (or have not) been ‘improved’ over the years. Lastly, this study discusses the implications regarding whether ‘universal’ definitions can or should be developed and attributed to each of the concepts in order to clear the murkiness between our understanding of the various concepts of tax compliance, non-compliance, and their sub-categories.