Achieving Taxpayer Compliance : The Effect of Tax Socialization, Tax Understanding, and Tax Sanctions

Abstract

This research aims to examine the influence of tax socialization, tax understanding, and tax sanctions on the compliance of Small Micro Business (SMB) taxoayers in the city of Dili, Timor-Leste. The population in this study consists of individual taxpayers registered with the Public Business Registration and Verification Office in Dili, Timor – Leste, totaling 2,672 taxpayers. Data for this study were obtained from questionnaires (primary) with a sample of 348 respondents. The data analysis technique used multiple linear regression analysis. The research results show that tax socialization, tax understanding, and tax sanctions have a positive influence on the compliance of SMB taxpayers because the significant value is less than 0.05. This research can contribute to the Public Business Registration and Verification Office in Timor – Leste as well as the Directorate General of Taxes to consider the consistency of tax socialization activities to SMBs in Dili and contribute to SMBs to improve compliance of individual taxpayers by increasing understanding of taxation and tax sanctions.