The determinants of Malaysia’s revenue: the role of e-filing, tax administration and tax compliance

Liew, Su Yee (2022) The determinants of Malaysia’s revenue: the role of e-filing, tax administration and tax compliance. PhD thesis, UTAR.

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Abstract

An over rm1 trillion of country’s national debt in Malaysia since year 2018 has brought the people’s attention to the government’s efforts especially the government revenue collection in the payback of the national debt. Tax revenue which is expected to be influenced by the effectiveness of tax administration mediated by tax compliance is the main concern due to its importance and biggest contribution to the government revenue. Due to the importance of tax revenue, the inland revenue board of Malaysia (IRBM) has been established to administer, assess, collect and enforce payment of taxes by the taxpayers. In year 2004, IRBM took initiative to launch the electronic system for tax filing (e-filing) and it is expected to affect the effectiveness of tax administration and, therefore, the tax revenue. In line with this, this research aims to investigate the impact of e-filing (including a comparison manual filing and e-filing) and the effectiveness of tax administration on tax revenue which is important for the government and the nation applying principal-agent approach (agency theory) supported by technology acceptance model (tam) and theory of planned behaviour (tpb). Questionnaires is designed and distributed to the respondents in meeting the research aim. Respondents of this research are formed by all the taxpayers in Malaysia. The data collected is analysed using partial least square structural equation modeling (pls-sem). The finding of this research has proven the significant relationships between effectiveness of e-filing, effectiveness of tax administration, tax audit rule, tax administration costs, tax evasion and avoidance, tax compliance and tax revenue. Other than that, present research has proven that tax compliance acts as a full mediator towards the association among effectiveness of tax administration and tax revenue. Tax authority and government will be benefited from the understanding of importance and connection between the constructs established in the research framework in the effort of raising malaysia tax revenue.

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