DOI: https://doi.org/10.36719/2706-6185/48/172-175
İlaha Huseynova
Azerbaijan State Economic University
Master student
https://orcid.org/0009-0006-9222-8126
huseynova.ilaha.nizami.2023@unec.edu.az
Factors Affecting Compliance With Tax Obligations
Abstract
Tax compliance is a complex and multidimensional concept that is not limited to economic and financial factor but also encompasses psychological, social and legal aspects. The behaviors and attitudes of individuals and businesses toward voluntarily fulfilling their tax obligations are influenced by a wide range of factors, which may vary depending on a country’s socio-economic development level, legal infrastructure, cultural values and governance quality. Primarily, factors such as an individual’s income level, the fairness and equity of applicable tax rates, the severity of penalties for non-compliance, the likelihood and intensity of tax audits, the clarity and simplicity of tax legislation, existing legal loopholes and contradictions, as well as the prevailing tax culture and public opinion within society, all significantly affect tax compliance. In addition, the transparency, accountability, and fairness of the state and tax authorities represent critical psychological and institutional factors that shape citizens' trust in the tax system. On the other hand, periodically implemented financial amnesties or tax debt write-offs, while they may have short-term positive effects, can lead to perceptions of injustice and mistrust in the system over the long term. Consequently, enhancing tax compliance requires not only effective fiscal policies but also the implementation of multidimensional measures, such as public awareness campaigns, legal reforms and increased transparency in governance.
Keywords: tax compliance, economic factors, non-economic factors, obligations, voluntary payment