INVESTIGATING THE NEXUS BETWEEN THE ATTITUDE TOWARD ELECTRONIC TAX SYSTEM AND THE LEVEL OF TAX COMPLIANCE- A MEDIATION ANALYSIS

Abstract

Tax compliance remains a significant challenge in Pakistan, particularly among  small business enterprises (SBEs). This study explores the role of attitudes toward electronic tax systems (ETS) in fostering tax compliance, with the adoption of ETS as a mediating factor. Utilizing a quantitative research approach, data was collected from 204 taxpayers using a structured questionnaire. Findings reveal that a positive attitude towards ETS significantly influences its adoption and subsequent compliance behavior. Moreover, ETS adoption mediates  the relationship between attitudes and compliance, underscoring the importance of digital transformation in taxation. The study highlights the need for tax authorities to enhance taxpayer awareness, improve digital infrastructure, and streamline e-taxation services to promote compliance. Policy recommendations include targeted training programs, simplification of tax procedures, and security enhancements in digital tax platforms to boost trust and engagement. These findings contribute to the literature on tax compliance in developing economies and provide actionable insights for improving fiscal governance in Pakistan.