Analyzing Taxpayer Compliance Behavior Under GST Regime: A Study Of Indian Taxpayers

Abstract

The Goods and Services Tax (GST) system that was introduced in India in 2017 has fundamentally changed the method in which indirect tax is levied in India. It is essential to understand taxpayer compliance behaviour within an indirect tax context post-GST to obtain useful measures and evidence-based guidelines for tax administration and the formulation of tax policies going forward. Hence, this study will examine the compliance behaviour of taxpayers under the GST regime, as well as the consequences of taxpayer compliance behaviour from influences such as tax knowledge, perception of fairness tax compliance cost, and legal enforcement measures impacts on voluntary tax compliance. A quantitative research design was implemented using a structured questionnaire survey to collect primary data from the taxpayers. The study used a survey sample of 300 individuals representing small business owners, professionals, and traders in various parts of India. The analysis of data, using descriptive analysis, correlation analysis and regression techniques revealed the meaningful relationship of factors viewed as significant determinants of taxpayer compliance behaviour. The results show that more the average tax knowledge and perception of fairness regarding GST positively impacts voluntary compliance with GST, while greater compliance costs negatively impact voluntary compliance. The audit system and the application of penalties are other enforcement behavior that were directly linked to compliant behavior and were also positively correlated with voluntary compliance. The paper considered taxpayer behavior within the GST regime and from this perspective adds empirical evidence to the existing studies of taxpayer behavior. The practical implications of the overall finding are that taxpayer education, simplicity of procedure, avoiding compliance costs, and fairness and transparency of tax and other systems can help enhance voluntary compliance. The value of this research lies in its engagement with taxpayer behavior relevant to tax authorities in terms of seeking to develop a more effective range of strategies to strengthen the tax base and improve revenue mobilization through GST.