A Study Between the Taxpayers’ Perception Toward the Tax Policy Changes and the Tax Compliance in Sri Lanka: A Tax Relief in Response to the Impact of Covid-19 Epidemic, and its Implications

K. G. Asela Gamini Bandara and W. M. R. B. Weerasooriya
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K. G. Asela Gamini Bandara: MBA holder, Rajarata University of Sri Lanka, Mihintale, Sri Lanka
W. M. R. B. Weerasooriya: Senior Lecturer, Rajarata University of Sri Lanka, Mihintale, Sri Lanka

Business, Management and Economics Research, 2021, vol. 7, issue 2, 52-64

Abstract: Purpose – This paper primarily investigates the relationship between the taxpayers’ perception of the tax policy changes and the tax compliance in Sri Lanka. The researcher also aims to provide advice to the policymakers about the specific approach to be followed when considering the tax relief measures and also emphasizing the importance of maintaining a flexible tax policy during the epidemic period which will be crucial in meeting the revenue target of the government. Design/Methodology/approach-The researcher used questionnaires to gather primary data from 125 respondents and then editing to spot errors and omissions for the aim of creating necessary corrections and at last, apply statistical tools for data analysis using SPSS software. Findings – The results show that taxpayers’ attitudes toward the changes in the tax policy and tax compliance form a strong positive relationship and further, changes in its policy have a significant impact on their compliance level. Cronbach’s alpha exceeds 0.7 implies that instruments are sufficiently reliable for the measurement. Originality/value- This was the first study undertaken to explore the link between the attitude toward the tax policy changes and the tax compliance in Sri Lanka during the Covid-19 epidemic period. This study guides to fill up the existing research gap in the country and further, directions are also useful for future researchers to undertake an identical survey.

Keywords: Tax compliance; Implications; Taxpayers’ perception toward the tax policy changes; Tax relief in response to the impact of Covid-19 pandemic; Sri Lanka. (search for similar items in EconPapers)
Date: 2021
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