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Article

Michael Heasman and Spencer Henson

Presents the results of a postal questionnaire to UK food and drink manufacturers on the costs of compliance with food regulation. In particular, the questionnaire focused…

Abstract

Presents the results of a postal questionnaire to UK food and drink manufacturers on the costs of compliance with food regulation. In particular, the questionnaire focused on the usefulness of compliance cost assessments ‐ introduced by the Government in 1985 across all government departments as an analytical tool for assessing the regulatory costs to business ‐ as they relate to food businesses. Explains that the questionnaire sought to establish to what extent food companies actually costed the impact of food regulation on their business operations and explored other aspects of food regulation, such as the benefits and constraints. Reports the results which gave some unexpected insights on the costs of compliance with food regulation. For example, the majority of respondents were not aware that the Ministry of Agriculture Fisheries and Food carried out compliance cost assessments on food regulation; around two‐thirds of the sample found it “difficult” or “very difficult” to identify where compliance costs would affect their company and an even greater proportion (more than three‐quarters) said they would have problems quantifying compliance costs. Concludes that the compliance cost assessment, as a tool for helping to analyse the cost of food regulation on businesses, is an inappropriate method for the food sector and the development of new methods should be considered.

Details

British Food Journal, vol. 99 no. 5
Type: Research Article
ISSN: 0007-070X

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Article

John L. Turner, Malcolm Smith and Bruce Gurd

Virtually all of the completed research to date shows that taxpayer compliance costs are large and generally a multiple of the revenue authority’s administrative costs

Abstract

Virtually all of the completed research to date shows that taxpayer compliance costs are large and generally a multiple of the revenue authority’s administrative costs. Compliance costs have also been found to be capricious in their incidence and generally highly regressive. On the other hand, for some taxes (eg. Employer PAYE deductions), much of the research shows that larger firms derive a net economic benefit from enhanced cash flows. There is also perceived to be a fair correlation between high compliance costs and high non‐compliance. These findings and perceptions have led to government pressure in most developed countries to reduce compliance costs. This paper explores the likely impact of compliance costs in the UK as income tax self‐assessment is introduced, leaning on evidence from Australia, where self‐assessment is the standard.

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Managerial Auditing Journal, vol. 13 no. 2
Type: Research Article
ISSN: 0268-6902

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Article

Doreen Musimenta, Sylvia Naigaga, Juma Bananuka and Mariam Ssemakula Najjuma

The purpose of this study is to examine the contribution of tax morale, compliance costs and tax compliance of financial services firms in Uganda.

Abstract

Purpose

The purpose of this study is to examine the contribution of tax morale, compliance costs and tax compliance of financial services firms in Uganda.

Design/methodology/approach

This study is cross-sectional and correlational and adopts firm-level data collected using a questionnaire survey of 210 financial services firms in Uganda from which usable questionnaires were received from 152 financial services firms.

Findings

Tax morale and compliance costs contribute up to 20.6 per cent of the variance in tax compliance of the financial services firms. Tax morale and tax compliance are positively and significantly associated. Results further indicate that compliance costs and tax compliance are positively and significantly associated. National pride and trust in government and its legal systems as dimensions of tax morale independently are significantly associated with tax compliance. Results also indicate that administration costs and specialist costs as dimensions of compliance costs individually are significantly associated with tax compliance.

Research limitations/implications

This study results should be generalized with caution, as they are limited to the financial services firms in Uganda.

Originality/value

Whereas there has been a number of studies on tax compliance in both developed and developing countries, this is the first study on the African scene to examine the contribution of tax morale and compliance costs on tax compliance of financial services firms in a single suite. It is unbelievable that the financial services firms, especially commercial banks which are highly regulated by the central bank in many developing countries, can afford to report tax payables year after year.

Details

Journal of Money Laundering Control, vol. 22 no. 1
Type: Research Article
ISSN: 1368-5201

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Article

A. Loh, M. Ariff, Z. Ismail, M. Shamsher and M. Ali

This is the first report on estimates of tax compliance costs of Malaysian companies. Compliance cost is an unavoidable cost of doing business and arises from activities…

Abstract

This is the first report on estimates of tax compliance costs of Malaysian companies. Compliance cost is an unavoidable cost of doing business and arises from activities associated with the reporting of income for tax purpose. The average compliance cost per company was estimated to be RM68,836, which is RM0.26 per RM 1,000 sales turnover. Sixty‐one percent of compliance cost was incurred in computation‐related activities and 39 percent in tax planning activities. Measured relative to revenue, the compliance cost is higher for smaller companies than for larger companies, which suggests that compliance cost is regressive, a finding similar to those reported in other countries.

Details

Pacific Accounting Review, vol. 9 no. 1
Type: Research Article
ISSN: 0114-0582

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Book part

Ioannis Stamatopoulos, Stamatina Hadjidema and Konstantinos Eleftheriou

This paper examines the corporate income tax compliance costs and their determinants by analyzing survey and financial statements data from firms operating in Greece. We…

Abstract

This paper examines the corporate income tax compliance costs and their determinants by analyzing survey and financial statements data from firms operating in Greece. We find that corporate tax compliance costs are of considerable size and vary with several firm-specific characteristics, including the firm’s size, its age, the sector in which it operates, its location, and its legal form. The paper intends to raise awareness regarding the impact of tax compliance costs, especially for countries, such as Greece, that were significantly affected by the economic and financial crisis.

Details

Advances in Taxation
Type: Book
ISBN: 978-1-78714-524-5

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Article

Milind Sathye

The purpose of this paper is to find out the likely compliance cost of anti‐money laundering and counter terrorism financing (AMLCTF) for financial institutions in…

Abstract

Purpose

The purpose of this paper is to find out the likely compliance cost of anti‐money laundering and counter terrorism financing (AMLCTF) for financial institutions in Australia to help understand the regulatory burden of the legislation.

Design/methodology/approach

The paper adopts a case study approach. Using the method of analogy, the cost of compliance is estimated.

Findings

It is found that the legislation brings substantial financial regulatory burden on the financial institutions in Australia. It is also found that the compliance cost is quite substantial and stands at about A$1.02 billion for the banking industry as a whole at 2007 prices. The per capita burden has been estimated at A$50 approximately. The author's estimate compares well with other publicly available estimates.

Research limitations/implications

Limitations of case study research method apply. Through this case study, prior work on regulatory cost burden on organisations is confirmed – in the context of financial institutions.

Practical implications

Policy makers and reporting entities the world over would particularly be interested in the findings as it helps gauge the cost impact of regulatory burden the legislation imposes. The compliance cost burden could affect the overall competitiveness of Australian financial institutions particularly because of the small size of the economy in terms of population.

Originality/value

This is the first paper in the literature that has attempted to estimate the cost of AMLCTF compliance. It is believed that the study could provide an impetus for similar studies in other jurisdictions.

Details

Journal of Financial Crime, vol. 15 no. 4
Type: Research Article
ISSN: 1359-0790

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Article

Hyungjin Lukas Kim and Jinyoung Han

The purpose of this paper is to investigate the impact of corporate social responsibility (CSR) on employees’ compliance behavior concerning information security policy…

Abstract

Purpose

The purpose of this paper is to investigate the impact of corporate social responsibility (CSR) on employees’ compliance behavior concerning information security policy (ISP). A research model includes CSR activities as an antecedent of ISP compliance and as a mediator of the relationship between ISP compliance intention and the perceived costs of compliance.

Design/methodology/approach

In total, 162 respondents were surveyed from organizations with more than 500 employees. This study used partial least squares (SmartPLS 3.0) to analyze and examine hypotheses.

Findings

The results show CSR’s influence as a mediator in the context of ISP compliance. In particular, moral CSR can affect employees’ ISP compliance intention positively and fully mediate the relationship between the costs of compliance and ISP compliance intention. Employees would like to comply with ISP when they recognize the benefits of ISP compliance and the costs of ISP noncompliance.

Originality/value

This study examines influential factors on ISP compliance considering cost-benefit factors from rational choice theory. Moreover, the study contributes to ISP compliance research by being the first attempt to consider CSR in an ISP compliance research context. The results provide insights on how to strategically implement CSR activities in terms of organizational information security.

Details

Information Technology & People, vol. 32 no. 4
Type: Research Article
ISSN: 0959-3845

Keywords

Abstract

Details

Taxing the Hard-to-tax: Lessons from Theory and Practice
Type: Book
ISBN: 978-1-84950-828-5

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Article

John Breen, Sue Bergin‐Seers, Ian Roberts and Robert Sims

This study examines the impact of the introduction of the Goods and Services Tax (GST) on small business in Australia in the context of the experiences faced in similar…

Abstract

This study examines the impact of the introduction of the Goods and Services Tax (GST) on small business in Australia in the context of the experiences faced in similar countries overseas. Using a case study methodology, data was gathered from six small businesses that were observed throughout the introductory period of the new tax system. In particular, this article considers the costs for small businesses in complying with the new tax system. Businesses reported actual GST compliance costs ranging from $3,331 to $30,140 per business in the cases examined. For the two smallest businesses, their compliance costs amounted to over 3% of the firm's reported annual turnover. The study also identified significant on‐going record keeping and accounting costs that are required by small businesses in order to meet their GST obligations. These findings indicate that governments need to be more aware of the impact of tax reforms on small businesses if they wish to implement changes with minimal adverse impacts on business operations.

Details

Asian Review of Accounting, vol. 10 no. 1
Type: Research Article
ISSN: 1321-7348

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Article

Mario Krenn

The purpose of this article is to explain under what circumstances firm-level adoption of codes of good corporate governance will more likely be superficial rather than…

Abstract

Purpose

The purpose of this article is to explain under what circumstances firm-level adoption of codes of good corporate governance will more likely be superficial rather than substantive in nature. The article contains lessons for any agency or country that attempts to implement deep and lasting changes in corporate governance via codes of good corporate governance.

Design/methodology/approach

The article reviews the literature on compliance with codes of good corporate governance and develops a conceptual model to explain why some firms that have formally adopted a code of good governance decouple this policy from its actual use.

Findings

Decoupling in response to the issuance of codes of good corporate governance will be more attractive to firms and also more sustainable under the following conditions: firms’ compliance costs are relatively high firms’ costs of outright and visible non-compliance are relatively high and outsiders’ compliance monitoring costs are relatively high.

Originality/value

The article contributes to the debate on compliance and convergence and provides policymakers with a conceptual framework for assessing the likelihood of successful regulatory change in corporate governance.

Details

Journal of Financial Regulation and Compliance, vol. 23 no. 4
Type: Research Article
ISSN: 1358-1988

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