Managing taxpayer compliance: Reflections on the drivers of willingness to pay taxes in times of crisis

Figures & data

Table 1. Respondent characteristics

Respondent Information	Freq.	%	Respondent Information	Freq.	%
Gender			Education
(0) Female	161	39,2	(1) High school level	16	3,9
(1) Male	250	60,8	(2) Vocational school	26	6,3
Place of domicile			(3) Bachelor	294	71,5
(0) Jakarta	245	59,6	(4) Master & PhD.	75	18,3
(1) Greater Jakarta area	166	40,4	Occupation status
Age (year)			(1) Private employees	275	66,9
(1) 18–24	45	10,9	(2) Civil Servants	61	14,8
(2) 25–35	215	52,3	(3) Lecturer	21	5,1
(3) 36–45	74	18,0	(4) Health Workers	4	1,0
(4) 46–55	63	15,3	(5) Self-employed	26	6,3
(5) >55	14	3,4	(6) Unemployed*	24	5,8

Note: *including students, job seekers, housewives, and retired.

Table 2. Description of variables

Variable	Full meaning	Definition	Source
Dependent variable:
WTP	Willingness to pay taxes	Willingness and readiness to contribute financially to the government by paying taxes	Ali et al. (2014); Taing and Chang (2020)
Independent variables:
TSS	Tax system/structure:	The structure of the tax system’s complexity and fairness and relevance measures taken by the tax authority to ensure compliance	Fischer et al. (1992); Vincent and Ntim (2021)
	Tax penalties (TP)	The level of authority that tax officials have to enforce tax laws and regulations	Gangl et al. (2020); Inasius (2019)
	Tax complexity (TC)	The degree of difficulty that taxpayers face in complying with tax laws and regulations	Taing and Chang (2020); Vincent and Ntim (2021)
TL	Tax education:	Understanding and awareness of tax-related information and knowledge and how government provide such matters	Agusti and Rahman (2023); Vincent and Ntim (2021)
	Tax information (TI)	The extent to which the government provides accurate and up-to-date information about tax issues that are easily accessible and understandable	Taing and Chang (2020); Vincent and Ntim (2021)
	Tax knowledge (TK)	The quality of understanding, awareness, and knowledge that taxpayers possess regarding their tax-related obligations	Owusu et al. (2023); Taing and Chang (2020)
TAnP	Tax attitude and perception:	This refers to the moral and ethical beliefs that taxpayers have regarding their tax obligations, their level of trust in the government, and their evaluation of the value and effectiveness of how tax revenue is spent	Alm and Gomez (2008); Fischer et al. (1992); Vincent and Ntim (2021)
	Tax morale (TM)	The individual’s personal values and beliefs about the importance of contributing to society through taxes	Luttmer and Singhal (2014); Taing and Chang (2020)
	Tax fairness (TF)	The perception of taxpayers regarding the fairness of the tax system	Mardhiah et al. (2023); Taing and Chang (2020)
	Trust in government (TG)	The level of confidence that taxpayers have in their government to effectively and efficiently manage public resources	Owusu et al. (2023); Taing and Chang (2020)
	Perceived worth of public spending (PW)	The extent to which taxpayers believe that public spending, particularly COVID-19-related spending, is justified and beneficial to society	Nkundabanyanga et al. (2017); Simmons and Cheng (1996)
Control variables:
	gender	Gender of the respondent	Torgler and Martinez-Vazquez (2005)
	age	Age of the respondent	Alm and Gomez (2008)
	education	Education level of the respondent	Gugushvili (2022)
	employment	Respondent employment at the time of the survey	Andriani (2016)
	domicile	Place of residence of the respondent

Source: Author

Table 3. Mean, factor loadings and reliability of IV

Constructs	Measures	Mean	FL	CA	CR
Independent variables (IV):
Tax knowledge (TK)	Awareness about the deadline for reporting annual tax return	3.72	0.88	0.84	0.90
	Awareness about any kind of taxes that must be paid	3.78	0.90
	Awareness about the penalties and consequences for evading tax obligations	4.09	0.83
Tax complexity (TC)	The tax reporting mechanism is still complicated.	3.29	0.94	0.88	0.90
	The existing tax regulations are still difficult to understand	3.13	0.89
	It is still difficult to calculate the tax payable	3.45	0.76
Tax fairness (TF)	The tax rate is fair based on each individual’s income	3.35	0.89	0.89	0.93
	The existing tax system is fair	3.23	0.91
	Tax authority implements a fair tax policy	2.77	0.92
Tax information (TI)	Accurate information regarding tax issues is easily available	3.65	0.85	0.84	0.90
	The latest and relevant information regarding tax issues is easily accessible	3.51	0.90
	The provided tax information is clear and understandable	3.41	0.85
Tax morale (TM)	Declaring all tax liabilities honestly	4.13	0.88	0.80	0.88
	Feel obliged to pay tax on income earned	3.95	0.79
	Feel obliged to follow the applicable tax rules	4.06	0.87
Tax penalties (TP)	Tax authority imposes severe penalties, such as sanctions and fines	3.54	0.79	0.84	0.90
	Tax authority are known to be strict when it comes to enforcing the law	3.50	0.92
	Tax authority imposes heavy tax penalties on those who refuse to comply	3.51	0.89
Perceived worth of public spending (PW)	The tax money that the government spends on handling COVID-19 are appropriate and responsible	3.72	0.84	0.81	0.89
	The government is spending a reasonable amount of tax money on handling COVID-19	3.78	0.89
	The ease of obtaining basic services from the government (COVID-19 vaccine)	4.09	0.83
Trust in government (TG)	The government is transparent in the use of tax money	3.05	0.92	0.87	0.92
	Tax revenues are spent wisely by the government on useful projects and infrastructure	3.46	0.92
	Tax obligation is not burdensome considering the social benefits provided by the government	3.10	0.85
Dependent variables (DV):
WTP	Do you think those who refuse to pay taxes are wrong?	2.38
WTP (alternative)	Do you think those who refuse to comply with tax laws are wrong?	2.25

Note: FL – Factor Loading; CA – Cronbach’s Alpha; CR – Composite Reliability.

Table 4. Drivers of willingness to pay taxes of COVID-19 survivors

Constructs	Model 1					Model 2
	β	SE		z	Sig.	β	SE	z	Sig.
Tax system/structure:
TP	0.22	0.15		1.45	0.148	0.25	0.16	1.61	0.108
TC	−0.29	0.11		−2.65	0.008	−0.31	0.11	−2.71	0.007
Tax education:
TI	0.32	0.16		1.96	0.049	0.29	0.15	2.01	0.045
TK	0.04	0.15		0.26	0.794	0.00	0.15	0.02	0.988
Tax attitude and perception:
TM	0.43	0.16		2.71	0.007	0.39	0.16	2.39	0.017
TF	0.28	0.15		1.95	0.052	0.29	0.16	1.75	0.080
TG	1.78	0.20		9.08	0.000	1.84	0.20	9.11	0.000
PW	0.71	0.17		4.25	0.000	0.72	0.17	4.11	0.000
Control variables:
gender					NA	−0.37	0.23	−1.59	0.111
age					NA	−0.26	0.12	−2.12	0.034
education					NA	0.18	0.17	1.06	0.291
employment					NA	−0.03	0.08	−0.42	0.674
domicile					NA	−0.12	0.23	−0.53	0.593
Pseudo R2					0.20				0.21
N					411				411

Note: SE – standard error; TP – tax penalties; TC – tax system complexity; TI – tax information; TK – tax knowledge; TM – tax morale; TF – tax system fairness; TG – trust in government; PW – perceived worth of COVID-19-related public spending.

Table A1. First-stage models

Variable	TP	TC	TF	TM	TG	PW	TI	TK
gender	0.04	0.52**	0.22	−0.19	−0.29	0.22	0.16	−0.39*
	(0.17)	(0.18)	(0.17)	(0.18)	(0.18)	(0.18)	(0.18)	(0.18)
age	0.31**	−0.28**	−0.36**	0.10	0.41**	−0.50**	−0.45**	0.23*
	(0.09)	(0.09)	(0.09)	(0.09)	(0.09)	(0.09)	(0.09)	(0.09)
education	−0.12	0.21	−0.04	0.47**	0.26	−0.03	0.21	0.16
	(0.14)	(0.14)	(0.14)	(0.14)	(0.14)	(0.13)	(0.14)	(0.15)
employment	0.01	0.08	0.02	−0.08	0.03	0.01	0.02	−0.09
	(0.06)	(0.06)	(0.06)	(0.06)	(0.05)	(0.06)	(0.06)	(0.06)
domicile	−0.50**	−0.34	0.33	−0.40*	−0.29	0.64**	0.25	−0.15
	(0.18)	(0.18)	(0.18)	(0.14)	(0.18)	(0.18)	(0.18)	(0.18)
Pseudo R^2	0.011	0.010	0.013	0.015	0.20	0.026	0.014	0.011
Obs.	411	411	411	411	411	411	411	411

Note: * and ** indicate significance with p values of 0.05 and 0.01, respectively. Standard errors are reported in parentheses

Table A2. Drivers of willingness to comply with tax procedures

Constructs	Model 1				Model 2
	β	SE	z	Sig.	β	SE	z	Sig.
Tax system/structure:
TP	0.10	0.15	0.63	0.528	0.12	0.15	0.77	0.442
TC	−0.25	0.11	−2.31	0.021	−0.25	0.11	−2.23	0.026
Tax education:
TI	0.18	0.16	1.12	0.264	0.18	0.17	1.10	0.273
TK	0.36	0.15	2.34	0.019	0.35	0.16	2.23	0.026
Tax attitude and perception:
TM	1.60	0.19	8.23	0.000	1.57	0.20	8.03	0.000
TF	0.49	0.15	3.18	0.001	0.50	0.15	3.22	0.001
TG	0.94	0.19	5.06	0.000	0.96	0.19	5.12	0.000
PW	0.80	0.17	4.71	0.000	0.81	0.17	4.67	0.000
gender					0.06	0.24	0.25	0.806
age					0.00	0.13	−0.03	0.974
education					0.11	0.19	0.60	0.547
employment					−0.17	0.08	−2.08	0.037
domicile					−0.02	0.24	−0.09	0.926
Pseudo R2				0.25				0.26
N				411				411

Note: SE—standard error; TP—tax penalties; TC—tax system complexity; TI—tax information; TK—tax knowledge; TM—tax morale; TF—tax system fairness; TG—trust in government; PW—perceived worth of COVID-19-related public spending.

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