Perceptions of Tax Compliance by SMEs and Tax Practitioners in New Zealand: A Divergent View?

New Zealand Journal of Taxation Law and Policy, 26(1): 57-85, 2020

30 Pages Posted: 12 Aug 2020

See all articles by Dr. Sue Yong

Dr. Sue Yong

Auckland University of Technology

Brett Freudenberg

Griffith University - Griffith Business School; Griffith University - Griffith Law School

Date Written: March 13, 2020

Abstract

Despite the economic importance of small and medium enterprises (SMEs), little is known about their tax compliance perceptions, which may influence their compliance behavior. This is particularly so in relation to comparing the tax perceptions of New Zealand SMEs and their tax practitioners. This article reports on a qualitative study which examined the tax compliance perceptions of New Zealand SMEs and their tax practitioners. The findings of this study reveal that SMEs’ perceptions of tax compliance are multifaceted and include legal factors, compliance costs, economic considerations and perceptions of “others”. On the other hand, tax practitioners generally have a narrow context focusing mainly on compliance cost and legal obligations. The tax policy implications from this study include that it can potentially assist tax authorities to design and implement strategies to influence SMEs’ compliance behaviors. Also, for tax practitioners it illustrates their important role in reducing the stress of their SME clients by assisting them through education, including how to use accounting reports for compliance and business control purposes.

Keywords: Tax, Compliance, SME, Small Business, New Zealand, Perceptions

JEL Classification: K34

Suggested Citation

Yong, Sue and Freudenberg, Brett, Perceptions of Tax Compliance by SMEs and Tax Practitioners in New Zealand: A Divergent View? (March 13, 2020). New Zealand Journal of Taxation Law and Policy, 26(1): 57-85, 2020, Available at SSRN: https://ssrn.com/abstract=3649856 or http://dx.doi.org/10.2139/ssrn.3649856

Sue Yong

Auckland University of Technology ( email )

AUT City Campus
Private Bag 92006
Auckland, 1142
New Zealand

Brett Freudenberg (Contact Author)

Griffith University - Griffith Business School ( email )

Brisbane, Queensland 4111
Australia

Griffith University - Griffith Law School ( email )

Nathan Campus, GU
Nathan 4111
Australia

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