Moderation of tax socialization of factors affecting taxpayer compliance in the time of Covid-19

Nandang Bekti Karnowati and Erna Handayani
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Nandang Bekti Karnowati: Muhammadiyah Cilacap Institute of Economic Science, Jl. Urip Sumoharjo 21A Cilacap 53232, Indonesia
Erna Handayani: Muhammadiyah Purwokerto University, Jl. KHA Dahlan 103 Purwokerto 53182, Indonesia

International Journal of Research in Business and Social Science (2147-4478), 2021, vol. 10, issue 5, 184-194

Abstract: The level of taxpayer compliance has decreased during the COVID-19 pandemic. The Regional Revenue Management Agency recorded that as many as 1.6 million motorized vehicles were in arrears in taxes as of September 2020. This study aims to empirically examine the effect of the tax whitening program, taxpayer awareness, and tax knowledge on taxpayer compliance with tax socialization as a moderating variable in the correlation. The questionnaire uses a Likert scale with 100 motor vehicle taxpayers domiciled in the Cilacap, Banyumas, Purbalingga, Banjarnegara, and Kebumen areas. The research sample was taken using the non-probability sampling technique. The questionnaire data was then processed using Partial Least Square (PLS) analysis by testing the outer and inner models. The results show that tax whitening, taxpayer awareness, and tax knowledge directly impact taxpayer compliance. However, tax socialization does not affect taxpayer compliance. Tax socialization cannot moderate the factors that support taxpayer compliance and does not directly affect taxpayer compliance. This study explains that tax whitening can be used as a solution to improve vehicle tax compliance. Meanwhile, tax awareness and tax knowledge which are internal factors, reflect that taxpayers have good knowledge to be aware of their obligations to pay taxes and comply with existing tax regulations. Tax socialization cannot moderate the factors that support taxpayer compliance and does not directly affect taxpayer compliance. These conditions indicate the government's lack of effort in providing tax information and knowledge to the public. Activities to disseminate information, tax knowledge, and tax education to the public must be carried out intensely and continuously to increase taxpayer compliance. Key Words: Tax Socialization, Taxpayers, Covid-19, Pandemic

Date: 2021
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