Elsevier

Information & Management

Volume 43, Issue 1, January 2006, Pages 109-126
Information & Management

Acceptance of electronic tax filing: A study of taxpayer intentions

https://doi.org/10.1016/j.im.2005.04.001Get rights and content

Abstract

Government today has benefited from information technology in many ways. The importance of understanding and influencing citizens’ acceptance of e-government services is critical, given the investment in technology and the potential for cost saving. Using the filing of personal income tax in Taiwan as an example of e-government services, this study integrated two important theories (TAM and TPB), and discussed the factors affecting the taxpayers’ intention to adopt a particular tax-filing method (from manual, two-dimensional barcode, or Internet) based on empirical data gathered from a large-scale nationwide survey. The demographic characteristics and perceptions of the taxpayers were also explored in order to identify potential determinants. Results indicated that taxpayers tend to concentrate on the usefulness of a tax-filing method and may be fairly pragmatic in developing general attitudes towards using the method. Interestingly, the effects of perceived ease of use, subjective norms, and self-efficacy on behavioral intention were different for manual and electronic tax-filers. Understanding these factors can extend our knowledge of taxpayers’ decision making and lead to better planning and implementation of e-government services.

Introduction

According to the annual Global e-Government Study of Brown University in the United States, Taiwan's ranking rose from the world's number 2 position in 2001 to first in 2002, among the 198 countries surveyed [10]; e-government in Taiwan provides its citizens and organizations with convenient access to government information and services. Electronic Filing of Personal Income Tax (eTax) is an important application that automates tax related processes in an attempt to improve efficiency in assessing and collecting tax information. It has the potential to improve tax-filing service while at the same time reducing costs to both taxpayers and tax collecting agencies. However, despite the readily available tax preparation software and its promotion by the government, only forty percent of all taxpayers switched to eTax and most taxpayers were unwilling to give up their paper forms. Thus, the problem of under-utilization still remained and plagued governments. Understanding why people accept or reject an IS has proven to be a challenging issues. The growing interest in e-government thus raises the question of how governments can increase citizens’ adoption of eTax.

User acceptance was defined by Swanson [30] to be a “potential user's predisposition toward personally using a specific system.” A review of previous research suggests that many studies were anchored in behavioral intention and reported a strong causal link between behavioral intention and targeted behavior [8]. Agarwal and Prasad [2] also argued that, in a survey-based research design, analysis of intention is more appropriate than actual usage.

Building on a study of technology acceptance, we attempted to develop further understanding of taxpayers’ behavioral intention in the Taiwanese context. Specifically, a nation-wide survey of taxpayers supported by the National Tax Administration (NTA) of Northern Taiwan Province was conducted to examine the actions that participants were likely to take.

Section snippets

Personal tax filing in Taiwan

Starting in 1998, citizens in Taiwan were able to choose among three tax-filing methods: manual, Internet-based, and two-dimensional (2D) barcode. Manual filing is the traditional method either by hand or typewriter. Taxpayers usually perform complex calculations using mental arithmetic or calculator, and then the return is delivered to the tax agency through the postal service or in person. After receiving a return, the agency uses a data entry service to input the data. This process is

Theoretical background and research model

Technology acceptance is important. We define this as an individual's psychological state with regard to his or her voluntary, intended use of a technology [16]. A fundamental intention-based theory is the Theory of Reasoned Action (TRA) [13]. According to this, external stimuli influence a person's attitude toward a behavior indirectly by influencing his or her salient beliefs about the consequences of performing the behavior. Adapted from this, both the technology acceptance model (TAM) and

Data collection

Data to test the model were drawn from a cross-sectional field study of Taiwanese taxpayers in 2003. A nation-wide questionnaire-based survey, supported by the tax agency, was conducted. Since taxpayers were able to adopt any one of the three filing methods (manual, 2D barcode, or Internet tax filing) at will, subjects were classified into one of three groups according to the method they adopted. Three variations of a questionnaire were developed and different data collection methods were

Exploratory study

In our exploratory study we tried to identify potential differences among the three kinds of taxpayers. Both uni- and multivariate analysis of variance were used to assess the difference among the three groups. With these steps we were trying to provide a picture of the taxpayers in each group and give insight into the reasons for adoption of tax-filing methods.

Discussion

Through the confirmatory and exploratory analyses, this study can help practitioners and researchers better understand taxpayers’ acceptance decision of eTax; this may shed light on interesting and subtle difference between different kinds of taxpayers. The study has the merits of conducting a technology acceptance investigation in a real-world tax-filing setting involving individual taxpayers and various tax-filing methods. Such a setting should increase the generalizability of the results.

Conclusion

The study provided some preliminary evidence about the criteria that taxpayers used to evaluate their adoption of a taxation IS. This could be valuable for governments in designing and implementing their e-government services. However, this study has a number of limitations. First, the effects of PBC may depend on the taxpayers’ past usage experience. In our study, instruments for PBC were consistent across taxpayers but electronic taxpayers had experience with eTax while manual might not have

Acknowledgements

We gratefully acknowledge support from the National Tax Administration of Northern Taiwan Province, Ministry of Finance in the 2003 research program for time and data collection efforts. We also thank the editors and anonymous reviewers for their valuable suggestions on this article.

Jen-Ruei Fu is a assistant professor in the Department of Information Management at the National Kaohsiung University of Applied Sciences in Taiwan, ROC. He received his MBA and PhD degrees in information management from National Central University in Taiwan. His current research interests includes government information systems and knowledge management.

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    Jen-Ruei Fu is a assistant professor in the Department of Information Management at the National Kaohsiung University of Applied Sciences in Taiwan, ROC. He received his MBA and PhD degrees in information management from National Central University in Taiwan. His current research interests includes government information systems and knowledge management.

    Cheng-Kiang Farn is a professor in the Department of Information Management at the National Central University in Taiwan, ROC. His teaching and research interests focus on electronic business, SCM and knowledge management. His major publications have been in the areas of electronic business and management of IS. Cheng-Kiang is also consultant to many government agencies and enterprises.

    Wen-Pin Chao is an IS analyst at the National Tax Administration of Northern Taiwan Province, Ministry of Finance in Taiwan, ROC. He received his MBA degree in information management from the National Central University. His current job focuses on tax information system, including management and development. He is one of the electronic tax-filing project initiators in Taiwan.

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