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5. Tax Compliance
a. Definition of Tax Compliance
In General Indonesia Dictionary, compliance means submission or obedience to the teachings or rules. Meanwhile, according to Gibson
1991 in Agus Budiatmanto 1999 as quoted by Jatmiko 2006, compliance is the motivation of a person, group or organization to act or
not act in accordance with the rules set. In the tax rules that apply are Tax Law. Thus, tax compliance is a compliance of person, in this case is the
taxpayers, towards regulation or taxation laws. According to Simon James et al, quoted by Gunadi 2005, the notion
of tax compliance is having the willingness of taxpayers to meet their tax obligations in accordance with applicable rules without need for the
holding of the examination, thorough investigation, a warning or a threat, the application of law and administrative sanctions. Santoso 2008
defines tax compliance as a situation where the taxpayer meets all tax obligations and enforce rights of taxation.
According Nurmanto in Rahayu 2010:138 says that tax compliance can be defined as a state where the taxpayer meets all tax obligations and
enforce rights of taxation. Compliance was said by Norma D. Novak was a climate awareness
and compliance of tax obligations that are reflected in the situation taxpayers understand or try to understand all of the provisions of the tax
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legislation, filling out tax forms with complete and clear, calculate the amount of tax payable correctly, pay the tax due on time Devano, 2006 in
Supadmi, 2010. Muliari and Setiawan 2010 explains that the criteria taxpayer abiding
by the Ministry of Finance of the Republic of Indonesia Number abiding taxpayers 192PMK.032007 as follows:
a. Timely in submitting the Notice;
b. Has no tax arrears for all types of taxes, unless the delinquent taxes
that have been licensed in installments or defer payment of taxes; c.
Financial Statements audited by a public accountant or a public financial supervisory agency with unqualified opinion for 3 three
years in a row; d.
Never convicted of a crime in the field of taxation based on court decisions that have been legally binding for a period of 5 five years.
b. Types of Tax Compliance
Tax compliance divided into two kinds, namely formal compliance and material compliance. Formal compliance is a situation where the
taxpayer has formal obligations in accordance with the provisions of the tax laws. Material compliance is a condition in which the taxpayer meets
all of the material terms of taxation, which is in accordance with the letter and spirit of tax laws.
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Formal compliance, which can be measured by assessing adherence to enroll, the deposit compliance, and compliance reporting. Material
compliance is more important, because it may be formally demonstrated taxpayer compliance, but what was deposited and reported by the taxpayer
is not necessarily in line with what it should be. Indicators that can be used to measure compliance is the result of the examination material.
In an effort to improve taxpayer compliance, administrative corrective measures are expected to encourage taxpayer compliance through:
a. Taxpayers comply because getting good service, fast, and pleasure, and
the taxes that they pay will useful to the development of the nation. b.
Taxpayers will comply because they think they will get severe sanctions due to taxes that they are not report detected by information
system and tax administration. Tax compliance is the fulfillment of tax obligations by taxpayers in
order to contribute the development expected in the fulfillment given freely. Hopefully with the fulfillment of voluntary compliance, the tax
revenue target will be met. From some explanation above it can be concluded, understanding tax
compliance is an abiding taxpayers and to implement and fulfill tax obligations in accordance with the provisions of tax laws and also taxpayer
who fulfill compliance is a taxpayer who fill SPT with honest, good and
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correct that SPT accordance with the provisions of the tax laws and submit to the tax office before the deadline.
With the compliance, then it implies that tax revenues will go fluently, because tax compliance has been shown that the taxpayer has properly
implement tax obligations. Tax compliance defined as a situation where the taxpayer meets all tax obligations and implement rights of taxation in
accordance with the provisions of applicable legislation. In order for tax target achieved, need to be grown continuously for
public’s consciousness and compliance to fulfill tax obligations.
Consciousness of taxation arising from within its own taxpayers without regard to any tax sanction. While tax
compliance arising due to aware of any tax sanction.
6. Taxpayer Conducting Business Operations and Professional Service
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