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A Preliminary Study of the Impact of Tax Fairness Perception Dimensions on Tax Compliance Behaviour in Australia


Tax fairness represents an important variable that can influence tax compliance behaviour in society. Up until now, research in this area has mostly taken place in the United States, however, tax fairness and non-compliance with tax laws represents a major problem affecting revenue authorities all over the World including those in Australia. The major purpose of this study is to investigate the impact of tax fairness perception dimensions on tax compliance behaviour in Australia. A survey questionnaire was administered to a sample of 105 postgraduate business students at an Australian University during the 2003 year. Factor analysis identified five tax fairness perception dimensions concerning: general fairness, tax rate structure, exchange with the government, self-interest and fairness of special provisions. The impact of the tax fairness dimensions on tax compliance behaviour was then assessed by OLS multiple regression analysis. The results showed that the tax fairness dimensions relating to tax rate structure and self-interest were significant. Further analysis confirmed the significance of these two dimensions on tax compliance behaviour along with demographic variables relating to age and education. From these preliminary results it seems that while tax fairness is a multidimensional concept, it only has varying effects on tax compliance behaviour in Australia.

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Prof Grant Richardson CTA
Grant works for the Department of Accountancy at the City University of Hong Kong. - Current at 01 October 2009
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