Structural Effects of Trust in E-Filing Software on E-Filing Acceptance in Services Sector

Structural Effects of Trust in E-Filing Software on E-Filing Acceptance in Services Sector

Abdulsalam Mas'ud (Universiti Utara Malaysia, Kedah, Malaysia) and Mohammed Abdullahi Umar (Universiti Utara Malaysia, Kedah, Malaysia)
Copyright: © 2019 |Pages: 19
DOI: 10.4018/IJEIS.2019040105
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Digitalizing tax collection systems through electronic tax filing (e-filing) could have the potential of maximizing revenues to concerned authorities as it blocks leakages that undermine collection efforts. In this article, the Unified Theory of Acceptance and Use of Technology (UTAUT) is expanded to explain the structural effects of trust in e-filing software on e-filing acceptance intention among micro-entrepreneurs in the services sector. A quantitative research design was adopted with data collected from 158 micro-entrepreneurs in five services sectors which was analyzed through PLS-SEM. From the analyses, it was found that performance expectancy, effort expectancy, and social influence significantly influence both trust in e-filing software and e-filing acceptance intention. Interestingly, the results revealed significant structural mediating effects of trust in e-filing among the three variables. These findings expand the explanatory power of UTAUT in relation to structural effects of trust in e-filing in the services sector. Equally, it will benefit policymakers in designing e-filing software in such a way to meet the users' requirements relating to language and compatibility.
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1. Introduction

Electronic tax filing (e-filing) system’s literature established consistent results on the influence of the exogenous on the endogenous latent constructs within the Unified Theory of Acceptance and Use of Technology (UTAUT) (McLeod, Pippin & Mason, 2009; Schaupp, Carter & McBride, 2010; Schaupp & Carter, 2009; Carter et al., 2011; Bhuasiri, Lee & Ciganek, 2016; Lu & Nguyen, 2016; Nisha, Iqbal, Rifat & Idrish, 2016; Tan & Foo, 2012; Aziz & Idris, 2014; Liang & Lu, 2013; Andriani, Napitupulu & Haryaningsih, 2017). However, the literature falls short in explaining why such consistency has been established in various settings. Countries like Nigeria that has the desire to explore alternative revenue sources through digitalizing their revenue system may be keen in understanding the mechanisms that explain why taxpayers are willing to use the digital system in paying their taxes. The fact is that revenue from those countries is dominated by oil which is a finite resource. Consequently, some state governments in those countries may be very difficult to sustain in the post-oil era due to poor revenue potentials, hence, will be left with no option than to explore ways and means for maximizing their tax revenue potentials. One important method to achieve this is digitalizing tax collection systems by state. It has been established that digitalizing tax revenue collection systems through e-filing guarantees tax revenue maximization among the state governments. As reported by Arora (2016), e-filed returns which constitute only 15-20% of the total filed returned contributes to about 75-80% of the total tax collection in India.

The issue of tax payment is a “social contract” which requires taxpayers to pay tax in anticipation of receiving public goods and services from the government. Interestingly, trust has been identified as a mediator in “social exchange” relationships (Blau, 1964; Aryee, Budhwar & Chen, 2002; Santoro & Saparito, 2003; Sue-Chan, Au & Hackett, 2012; Chancey et al., 2015). Through its role as a mediator in social exchange, it would be possible to serve as a mechanism that can explain why exogenous variables in UTAUT - performance expectancy, effort expectancy and social influence have consistent effects on endogenous variable – acceptance intention. Baron and Kenny (1986) posits that, when the relationship between variables are consistent, it could be possible that there is a mechanism that explains the reason for such consistency which could be policy direction for policymakers, hence, the need for mediation analyses.

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