Tax knowledge and tax compliance determinants in self assessment

have a good and reasonable knowledge and understanding of tax matters. However,
the awareness and attitude of the taxpayer himself is more important since the
effectiveness of tax education depends on the readiness, acceptance and honesty of
taxpayers. Further details regarding tax education programmes in various countries
are discussed in section 2.4 and Chapter 3.
2.3.2 Simplicity of the system
The second key implementation issue discussed in this study is the simplicity of the
system. Silvani and Baer (1997) outlined the importance of the fact that a tax
authority should have a simple tax return system from a taxpayer’s point of view. A
tax authority might assume its tax return is simple and easy to complete but it may not
be so from the taxpayers’ point of view. Therefore, before the final and actual version
is delivered to taxpayers, it would be normal to put the forms through a series of
‘pilot’ tests to validate that the tax return is simple and easy to complete. (For
example in the UK, refer to 2.4.1 (b)). Evidence suggests that uncomplicated tax
returns play a major role in improving tax compliance (Silvani and Baer, 1997).
Although tax knowledge and the simplicity of tax returns have a different impact on
compliance (see Kirchler, 2008), it is noted that a taxpayer with low tax knowledge
may be able to file the tax returns accurately provided the tax returns are simple,
clearly explained and consistent 23 .
23 The current year of tax returns should be the same as the previous one or at least largely the same.
This can encourage taxpayers to file their tax returns correctly.
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