Data collection and Sampling

151 response rate of 10 percent. While the response rate is low refer Slemrod Venkatesh, 2002 the absolute number of responses is sufficient for further analysis. The sample comprise of New Zealanders listed on the 2008 Preliminary Electoral Roll. The Electoral Roll is a list of all registered New Zealand voters over the age of 18 years and will include most New Zealand individual taxpayers. A major limitation is that it will also include taxpayers who do not have to file tax returns but receive a Personal Tax Summary PTS. Nonetheless, the use of the Electoral Roll in tax studies has been previously undertaken in New Zealand by Hasseldine et al. 1994.

5.2 Measurement techniques

Twelve items were used to measure the five dimensions of fairness. Out of these, four items were adapted from the previous study Gilligan Richardson, 2005 while the remaining items were self-developed with reference to the concept of fairness in Equity Theory and the New Zealand income tax system. The items were scaled such that a higher number reflects a fairer perception. For compliance behavior, a hypothetical tax scenario relating to overstating expenses was developed. Following the scenario, 14 statements relating to the TPB variables intention, attitude, subjective norm and perceived behavioral control were generated and the respondents were requested to express their opinions on the statements. Intention, attitude and subjective norm were scaled such that a higher number corresponds to more compliance with tax obligations. In this study, compliance behavior was measured through its proxy, intention to comply. Perceived behavioral control, on the other hand, measures control over non- 152 complying with tax obligations and was scaled such that a higher number reflects higher control over non-compliance. Three items to measure tax knowledge were developed based on various definitions available in previous studies. These items represent general knowledge, legal knowledge and technical knowledge. To measure tax complexity, six items were developed measuring both content and compliance complexity. Tax knowledge was coded such that a higher number reflects higher tax knowledge. Tax complexity, on the other hand, was scaled such that a higher number corresponds to a lower level of tax complexity. All items were developed based on the 7-point Likert Scale, from strongly disagree 1 to strongly agree 7. In addition, respondents were also asked to provide demographic background information, including age, gender, ethnicity, education level, annual income, source of income and filing experience.

5.3 Demographic information

The relevant demographic information of the sample and the descriptive analysis of the responses are set out in Table 1, Table 2 and Table 3, respectively. From Table 1, it shows that 60.7 percent of the respondents are in the range of 30s to late 50s age group. While male and female respondents are almost equally represented, 50 percent of them are at least, holders of a diploma or degree. With regard to filing experience, the majority 73 percent have filed their tax returns for more than five times.