Effect of Tax Enforcement Capacity on Tax Compliance with Moderating Effect of E-Tax Adoption

Abstract

This study has focused mainly on investigating the effect of tax enforcement capacity on tax compliance with moderating effect of adoption of e-tax system in Pakistan. This study has considered fairness perception, tax knowledge, and tax complexity as independent variables, adoption of e-tax system as moderating variable, and tax compliance as dependent variable. In addition, this study has finalized taxpayers (salaried persons) of twin cities of Pakistan to investigate the relationship between variables mentioned above. To prove this relationship, a survey has been conducted through an adopted structured questionnaire regarding this literature, in which taxpayers (salaried persons) of twin cities of Pakistan have been requested to share their experiences by filling the questionnaires. To identify the results on data gathered from the respondents, statistical tests have been used. Some of the statistical tests used in this study include descriptive frequencies, descriptive statistics, reliability, correlation, and regression analysis. Results derived through statistical instruments with the help of SPSS software have shown that fairness perception, tax knowledge, and tax complexity positively effects tax compliance. In addition, it is also proved that adoption of e-tax system significantly moderates the relationship between fairness perception, tax knowledge, and tax complexity (independent variables) and tax compliance (dependent variable) in Pakistan.