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Abstract
This study focuses on the determinants of taxpayer compliance behaviour with respect to coiporate income tax reporting requirements in Malaysia. A researcher-administered questionnaire survey method for data collection was utilised. The findings of tliis study reveal that busmess age, tax liability and tax complexity consistently influence the likelihood of tax non-compliance behaviour in the areas of under-reporting income, over-claiming expenses and overall non-compliance. Nonetheless, the tax compliance costs have an insignificant relationship with the non-compliance behaviour of coiporate taxpayers. The remaining factors examined are significant determinants in at least one type of non-compliance behaviour.
1. INTRODUCTION
The introduction of the self-assessment system (SAS), which replaced the official assessment system (OAS) from 2001, is a major reform of the Malaysian tax system since the inception of the Income Tax Act (ITA) in 1967.4 The SAS imposes greater accountability upon taxpayers in terms of computational, recordkeeping and filing requirements. Moreover, as tax officials are no longer reviewing all returns filed under the SAS, more resources are available for enforcement activities to ensure greater tax compliance. Tax compliance behaviour has always been an area of concern to tax policy makers, as non-compliance with reporting requirements affects revenue collection and the ability of the government to achieve its fiscal and social goals.'
Under self-assessment, various factors may have an impact on the level of tax compliance. To date, however, very few empirical studies to identify the determinants of corporate taxpayer compliance behaviour have been conducted, especially studies involving large corporations. Corporate Income Tax (CIT) is an important source of revenue for Malaysia's federal government, accounting for about 50% of the Inland Revenue Board of Malaysia's (IRBM) tax collection in 2009. This warrants research that can provide insight into the reasons for non-compliance among corporate taxpayers, hence contributing to the tax literature on CIT compliance behaviour in public companies. The relationships between corporate characteristics, tax compliance costs, attitudinal aspects and the compliance behaviour of Malaysian public listed companies (PLCs) are examined in this study.
2. LITERATURE REVIEW AND HYPOTHESES DEVELOPMENT
Tax compliance is defined as the accurate reporting of income and claiming of expenses in accordance with stipulated tax laws.6 Thus, the failure of corporations to accurately report or pay CIT is considered corporate tax non-compliance.7 There are...