•  
  •  
 

Creative Commons License

Creative Commons Attribution-Share Alike 4.0 International License
This work is licensed under a Creative Commons Attribution-Share Alike 4.0 International License.

Abstract

This study examines the role of public trust in shaping future taxpayer compliance, a critical factor for achieving the long-term development vision of Indonesia Emas 2045. While trust has been extensively studied in the context of current taxpayers, research on its role among younger generations as future taxpayers in developing economies remains limited. To address this gap, a mixed-methods approach was employed, combining survey data from 420 students with in-depth interviews. The data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) to test the hypothesis that public trust influences future taxpayer compliance. The results demonstrate that public trust has a strong and significant effect on taxpayer compliance intention (β = 0.533, p < 0.001), explaining nearly 28% of the variance in compliance behavior. Although trust in individual leaders, such as the president, is relatively high, concerns over corruption, unequal welfare distribution, and weak institutional legitimacy reduce overall trust in the tax system. Qualitative findings further reveal skepticism among the younger generation regarding the fairness and effectiveness of tax allocation. These findings highlight the importance of enhancing policy transparency, strengthening oversight mechanisms, reducing inequality, and integrating civic education to foster tax morale. Building institutional trust is thus crucial to secure sustainable tax compliance among future taxpayers in Indonesia.

References

Agbanyo, R., Musah, G., Doku, J. N., Quarshie, J., & Dery, N. Y. (2024). Perceived political corruption and tax compliance intentions among private enterprises in emerging economies: The roles of tax morale and tax tolerance in Ghana. Journal of International Development.

Alm, J. (2019). What Motivates Tax Compliance? Journal of Economics Surveys, 26(3), 658–679.

Alm, J., & Togler, B. (2011). Do Ethics Matter? Tax Compliance and Morality. Journal of Business Ethics, 101, 635–651.

Andini, Mega., & Rahmiati, Alfa. (2020). Tax Moral and Compliance of Individual Taxpayer. Journal of Security and Sustainability Issues, 10. https://doi.org/10.9770/jssi.2020.10.Oct(34)

Augustine, A. A., Agbetunde, L. A., & Lawal, B. A. (2022). Trust relationship and tax compliance in developing countries-Informal sector perspectives. International Journal of Economics, Commerce and Management, 10(6), 309–332.

Augustine, A. A., & Akintoye, I. R. (2019). Government Transparency Moderated By Trust in Government and Voluntary. International Journal of Economics, Commerce and Management, United Kingdom, 7(8), 624–644.

Bappenas. (2023). Bonus Demografi dan Visi Indonesia Emas 2045. Badan Perencanaan Pembangunan Nasional (Bappenas). https://bappeda.temanggungkab.go.id/frontend/download_unduh/689

Battilossi, S., & Pittaki, Z. (2024). Down a Slippery Slope: Lack of Trust, Coercive Threats and Business Tax Resistance in Greece, 1955-1988. Enterprise and Society, 57–93. https://doi.org/10.1017/eso.2023.51

Bird, R. M., & Zolt, E. M. (2005). Tax Policy in Developing Countries. The World Bank Economic Review, 19(1), 91–120.

Bobek, D. D., Hageman, A. M., & Kelliher, C. F. (2013). Analyzing the Role of Social Norms in Tax Compliance Behavior. Journal of Business Ethics, 115(3), 451–468. https://doi.org/10.1007/s10551-012-1390-7

Chen, X. (2007). Values and Life Styles in Urban Asia: A Cross-Cultural Analysis and Sourcebook Based on the AsiaBarometer Survey of 2003. The Journal of Asian Studies, 65(2), 398–400.

Cleary, M. R., & Stokes, S. C. (2006). Democracy and the Culture of Skepticism: The Politics of Trust in Argentina and Mexico. Russell Sage Foundation.

Cooper, C. A., Knotts, H. G., & Brennan, K. M. (2008). The Importance of Trust in Government for Public Administration: The Case of Zoning. Pubic Administration Review, 68(3), 459–468.

Cummings, R. G., Martinez-Vazquez, J., McKee, M., & Torgler, B. (2009). Tax morale affects tax compliance: Evidence from surveys and an artefactual field experiment. Journal of Economic Behavior and Organization, 70(3), 447–457. https://doi.org/10.1016/j.jebo.2008.02.010

Do, H. T. H., Mac, Y. T. H., Tran, H. T. Van, & Nguyen, T. T. Le. (2022). The impact of attitude towards an e-tax system on tax compliance of Vietnamese enterprises: Adoption of an e-tax system as a mediator. Journal of Entrepreneurship, Management and Innovation, 18(1), 35–64. https://doi.org/10.7341/20221812

Falsetta, D., Schafer, J. K., & Tsakumis, G. T. (2023). How Government Spending Impacts Tax Compliance. Journal of Business Ethics, 190(2). https://doi.org/10.1007/s10551-023-05383-3

Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2019). Multivariate Data Analysis (Eight Edition). Cengage Learning.

Hauptman, L., Žmuk, B., & Dečman, N. (2024). Tax governance in compliance: The role of motivational postures and behavioral intentions. Problems and Perspectives in Management, 22(1), 500–513. https://doi.org/10.21511/ppm.22(1).2024.40

Hayat, N., Salameh, A. A., Mamun, A. Al, Helmi Ali, M., & Makhbul, Z. K. M. (2022). Tax Compliance Behavior Among Malaysian Taxpayers: A Dual-stage PLS-SEM and ANN Analysis. SAGE Open, 12(3). https://doi.org/10.1177/21582440221127190

Hong, N. T. P. (2023). Suggestions for the City From Examining Impacts of Non-Economic Factors Affecting Voluntary Tax Compliance – Case of Vietnam Businesses. International Journal of Professional Business Review, 8(3), 1–25. https://doi.org/10.26668/businessreview/2023.v8i3.934

Inasius, F. (2019). Voluntary and Enforced Tax Compliance: Evidence From Small and Medium-Sized Enterprises in Indonesia. Advances in Taxation, 26, 99–111. https://doi.org/10.1108/S1058749720190000026006

Inasius, F., Darijanto, G., Gani, E., & Soepriyanto, G. (2020). Tax Compliance After the Implementation of Tax Amnesty in Indonesia. SAGE Open, 10(4). https://doi.org/10.1177/2158244020968793

Kim, S., & Lee, J. (2012). E-Participation, Transparency, and Trust in Local Government. Public Administration Review, 72(6), 819–828.

Kinyondo, A., & Byaro, M. (2019). Does Citizen’s Trust in Government Increase Willingness to Pay Taxes in Tanzania? A Case Study of Mtwara, Lindi and Dar es Salaam Regions. African Journal of Economic Review, 7(1), 176–187.

Kirchler, E. (2007). The Economic Psychology of Tax Behaviour. Cambridge University Press.

Kogler, C., Batrancea, L., Nichita, A., Pantya, J., Belianin, A., & Kirchler, E. (2013). Trust and power as determinants of tax compliance: Testing the assumptions of the slippery slope framework in Austria, Hungary, Romania and Russia. Journal of Economic Psychology, 34, 169–180.

Luttmer, E. F. P., & Singhal, M. (2014). Tax morale. Journal of Economic Perspectives, 28(4), 149–168. https://doi.org/10.1257/jep.28.4.149

Marlowe, J. (2014). Part of the Solution or Cogs in the System?: The Origins and Consequences of Trust in Public Administrators. Public Integrity, 6(2), 93–113. https://doi.org/10.1080/10999922.2004.11051251

Mebratu, A. A. (2024). Theoretical foundations of voluntary tax compliance: evidence from a developing country. Humanities and Social Sciences Communications, 11(1). https://doi.org/10.1057/s41599-024-02903-y

Nair, S., Lee, J., & Yuet, V. (2024). Tax Compliance Among SMEs: A Study in Selangor Malaysia. https://www.researchgate.net/publication/387413477

Nyantakyi, G., Sarpong, F. A., Asiedu, F., Bimpeh, D. A., Ntoso, J. K. A., & Nunoo, L. O. (2024). Unearthing the mediating role of political affiliation in tax compliance determinants: new evidence from Ghana. Cogent Business and Management, 11(1). https://doi.org/10.1080/23311975.2024.2316886

Pangesti, N. G., Alkausar, B., Soemarsono, P. N., Hijriah, H. Y., & Abdullah, A. (2023). Justice, Trust, Perceived of Risk and Voluntary Tax Compliance in MSME. TIJAB (The International Journal of Applied Business), 7(2), 185–195. https://doi.org/10.20473/tijab.v7.i2.2023.50103

RASHID, S. F. A., RAMLI, R., PALIL, M. R., & AMIR, A. M. (2021). The Influence of Power and Trust on Tax Compliance Motivation in Malaysia. International Journal of Economics and Management, 15(1), 133–148.

Rotimi, O., Araga, A. S., Mudashiru, O. O., & Adekunle, A. R. (2020). Slippery Slope Framework and Tax Compliance among Corporate Taxpayers in Nigeria JEL Classification Codes: H200, H260. Accounting & Taxation Review, 4(1).

Samantela, S. S., & Maquiling, K. S. M. (2024). Examining Institutional Challenges of Land Value Capture: The Case of Implementing Land-based Taxes in the Philippines. Journal of Human Ecology and Sustainability, 2(1), 7. https://doi.org/10.56237/jhes23021

Setkab RI. (2024). President Jokowi Highlights Indonesia’s Demographic Potentials, Challenges. Sekretariat Kabinet Republik Indonesia. https://setkab.go.id/en/president-jokowi-highlights-indonesias-demographic-potentials-challenges/

Shi, H. (2024). Analysis of Individual Income Tax Compliance in China from the Perspective of Behavioral Economics. Finance & Economics, 1(4). https://doi.org/10.61173/0eqj6q49

Stilia, L. Y., Riandoko, R., & Kartiko, N. D. (2024). Power and Trust: a Mediator in the Relationship Between Procedural Justice and Tax Compliance in Indonesia. Jurnal Aplikasi Akuntansi, 8(2), 300–314. https://doi.org/10.29303/jaa.v8i2.327

Tanzi, V., & Davoodi, H. R. (2000). Corruption, Public Investment, and Growth. Economics of Governance, 1(123–47).

Thu, H. D. T. (2024). Income tax compliance behavior of businesses: The case of Vietnam. Decision Science Letters, 13(1), 135–142. https://doi.org/10.5267/j.dsl.2023.11.002

Todaro, M. P., & Smith, S. C. (2015). Economic Development (12th editi). Pearson Education.

Torgler, B. (2007). Tax morale : theory and empirical analysis of tax compliance. https://www.researchgate.net/publication/277171020

Twesige, D., Rutungwa, E., Faustin, G., Misago, I. K., & Mutarinda, S. (2024). Gender and the tax compliance puzzle: does gender influence taxpayers’ behaviour towards tax compliance? Evidence from Rwanda. Cogent Business and Management, 11(1). https://doi.org/10.1080/23311975.2024.2316887

First Page

16

Last Page

27

Download

Share

COinS
 
 

To view the content in your browser, please download Adobe Reader or, alternately,
you may Download the file to your hard drive.

NOTE: The latest versions of Adobe Reader do not support viewing PDF files within Firefox on Mac OS and if you are using a modern (Intel) Mac, there is no official plugin for viewing PDF files within the browser window.