Project topics and materials
Get Complete Project Material File(s) Now! »
OBJECTIVES OF THE STUDY
The primary objective for this study was to determine the perceptions of South African taxpayers about various aspects with regard to taxation. South African taxpayers, for the purpose of this study, included natural persons from the four major South African population groups who were twenty-one years and older. This study made use of the term taxpayers despite the fact that some natural persons might not have been liable for income tax, as their income was below the tax threshold. All natural persons, however, pay tax when purchasing goods and services and, therefore, contribute towards government income.
The following secondary objectives were set for this study to assist in achieving the primary objective:
• To determine perceptions about general tax-related issues amongst South African taxpayers.
• To determine the various demographic, economic or other factors that might influence a taxpayer’s attitude with regard to general tax-related issues.
• To determine perceptions about tax evasion and tax compliance statements amongst South African taxpayers.
• To investigate the relationship between taxpayers’ views with regard to a specific taxrelated statement and their attitudes towards tax evasion and tax compliance.
• To investigate the relationship between taxpayers’ views concerning a specific tax evasion statement and their attitudes towards tax compliance.
• To determine whether taxpayers’ perceptions about tax penalties are related to their attitudes regarding tax evasion.
• To determine whether the perceptions about taxation of the various population groups differ.
• To assess whether the findings from the current research substantiates earlier research.
This study aimed to establish the likelihood that taxpayers’ perceptions with regard to taxation would influence their attitudes towards tax compliance. This study then assumed that if taxpayers have negative perceptions about taxation, they will also have negative attitudes towards tax compliance and vice versa.
If it was found that taxpayers’ perceptions influenced their attitudes towards tax compliance, it could be inferred that it is important to concentrate on changing taxpayers’ perceptions with regard to taxation in order to achieve a more positive attitude towards tax compliance.
IMPORTANCE AND BENEFITS OF THE STUDY
Despite all the efforts of SARS, there still appears to be a significant tax gap in South Africa (Naidoo, 2005:13). It is of utmost importance to protect the country’s tax base. This research is thus important as it revolves around tax compliance (that is, people’s willingness to pay tax) as well as the obverse, tax resistance.
It is imperative to determine taxpayers’ perceptions with regard to taxation in order to not only influence government policy regarding taxation, but also to enable government to market itself and its services more effectively to the general public. This study is also important as it focuses on the perceptions of taxpayers.
The significance of this research is further emphasised by the fact that only limited research on taxpayers’ perceptions has been conducted within a South African context. To the writer’s knowledge only one accredited study (Oberholzer, 2005:249-275) has investigated taxpayers’ perceptions in South Africa. A limitation of the study undertaken by Oberholzer (2005:249- 275) is that it focused on previously disadvantaged South Africans and disregarded other population groups of the country. Hence, this study is important as it attempted to build upon this previous research by including a broader segment of individuals in South Africa. In doing so, it is hoped that this study will also open further fields of research regarding taxation in South Africa.
DEFINING THE KEY TERMS
This research revolved around a number of key concepts, namely, taxation, tax evasion, tax compliance, South African taxpayers, perceptions, as well as population groups. The manner in which these key terms have been defined for the purpose of this study is considered below. Taxation: Taxation, for this study, is defined as: “…a compulsory unrequited payment to the government” (Organisation for Economic Cooperation (OECD), 2004).
Tax evasion: Tax evasion, for the purpose of this study, refers to illegal activities deliberately undertaken by a taxpayer to free him or herself from a tax burden, for example, where a taxpayer omits income from the annual tax return (Lewis, 1982:123; OECD, 2004; Stiglingh, Venter & Hamel, 2005:389; Webley, Robben, Elffers & Hessing, 1991:2).
Tax compliance: For this study, tax compliance, typically means: “…true reporting of the tax base; correct computation of the liability; timely filing of the return; and timely payment of the amounts due” (Franzoni, 1998:5).
South African taxpayers: South African taxpayers, for the purpose of this study, included natural persons from the four major South African population groups who were twenty-one years and older. As mentioned previously, this study made use of the term taxpayers despite the fact that some natural persons might not have been liable for income tax, as their income might have been below the tax threshold. All natural persons do, however, pay tax when purchasing goods and services and thereby contribute towards government income.
Perception: For this study perception is defined as: “The process by which people sense, select, and interpret stimuli” (Lumsden & Lumsden, 2000:382).
Population groups: The population groups for this study consisted of the four major South African population groups (that is, White, Coloured, Indian and Black/African) as defined by Statistics South Africa (Statistics South Africa, 2004:1).
CHAPTER 1: INTRODUCTION TO THE STUDY
1.1 INTRODUCTION AND BACKGROUND TO THE STUDY
1.2 PROBLEM STATEMENT
1.3 OBJECTIVES OF THE STUDY
1.4 IMPORTANCE AND BENEFITS OF THE STUDY
1.5 DEFINING THE KEY TERMS.
1.6 RESEARCH DESIGN AND METHODOLOG
1.7 DEMARCATION OF STUDY
CHAPTER 2: LITERATURE REVIEW
2.1 INTRODUCTION
2.2 TAX EVASION AND TAX AVOIDANCE.
2.3 WHY DO PEOPLE EVADE TAXES? – AN ECONOMIST’S VIEWPOINT
2.4 WHY DO PEOPLE EVADE TAXES? – A SOCIAL PSYCHOLOGICAL VIEWPOINT
2.5 PREVIOUS EMPIRICAL RESEARCH PERFORMED ON TAX-RELATED MATTERS
2.6 PREVIOUS RESEARCH PERFORMED IN RELATION TO TAXPAYERS IN SOUTH AFRICA
2.7 TAX ETHICS
2.8 HISTORY OF TAXES
2.9 DEFINING PERCEPTIONS FOR THIS STUDY
2.10 SUMMARY.
CHAPTER 3: RESEARCH DESIGN AND METHODOLOGY
3.1 INTRODUCTION
3.2 RESEARCH DESIGN
3.3 SAMPLING
3.4 DATA COLLECTION
3.5 PREPARATION, ANALYSIS AND INTERPRETATION OF DATA
3.6 VALIDITY AND RELIABILITY OF DAT
3.7 ETHICAL CONSIDERATIONS
3.8 SUMMARY.
CHAPTER 4: DEMOGRAPHIC AND OTHER FACTORS
4.1 INTRODUCTION
4.2 REPRESENTATIVITY OF THE SAMPLE
4.3 ECONOMIC CIRCUMSTANCES OF THE RESPONDENTS
4.4 RISK PROFILE.
4.5 RELATIONSHIP WITH SARS
4.6 FISCAL ATTITUDES
4.7 SUMMARY
CHAPTER 5: ANALYSIS OF RELATIONSHIPS
CHAPTER 6: CONCLUSIONS AND IMPLICATIONS
LIST OF REFERENCES
