Tax Compliance Motives Among Grab Car Drivers in Malaysia

Journal of Critical Reviews

ISSN- 2394-5125 Vol 7, Issue 11, 2020

TAX COMPLIANCE MOTIVES AMONG GRAB CAR DRIVERS IN MALAYSIA

Nik Puteri Nur Anis Noor Azmi1, Indarawati Tarmuji2, Nadiah Abd Hamid3*, Zarinah Abdul Rasit4, Norfadzilah Rashid5

1,2,3,4Faculty of Accountancy, Universiti Teknologi MARA (UiTM) Selangor. 5Faculty of Business and Management, Universiti Sultan Zainal Abidin, Gong Badak Campus, Terengganu. *[email protected]

Received: 06.04.2020 Revised: 13.05.2020 Accepted: 04.06.2020

Abstract E-hailing is one of the platforms that users choose as daily transportation by ordering transportation through the application software via devices, and Grab is the leading E-hailing service with the highest revenue among E-hailing services. On the other hand, tax collection is the major source of the continuous development of the country. The objective of this study is to examine the relationship between tax knowledge, tax awareness, tax morale, and tax penalty with tax compliance among Grab car drivers in Malaysia. The theory of planned behaviour applied for this study in order to engage the behaviours of taxpayers towards tax compliance. To achieve the research objectives, a simple random sampling technique was used in this research as this study is limited to Grab car drivers in Malaysia and questionnaires have been distributed and answered by 100 respondents via online survey questionnaires. The data analysis method of this study was conducted using the Statistical Package for the Social Sciences software (SPSS) Version 24. Based on the results, tax knowledge, tax morale, and tax penalty have significantly affected tax compliance among Grab car drivers in Malaysia. The result of this study may assist tax authorities, academicians, and future researchers to enhance the level of tax compliance among Grab car drivers in Malaysia. Keywords: Tax Compliance, Tax Morale, Tax Awareness, Tax Penalty, Tax Knowledge.

INTRODUCTION May, Grab Car was introduced and their company headquarters Presently, Grab is in the pursuit of becoming the largest moved to Malaysia. In 2015, the Grab Bikes and Grab Car services transportation medium and accomplishing the highest revenue were launched in the Philippines. In 2017, Grab Family was worldwide compared to others, with revenue amounting to US$1 introduced and later in March 2018, Grab made a decision to billion (RM4.15 billion). In 2019, Grab anticipates doubled merge with Uber's Southeast Asian operations. As a result, Grab revenue of more than US$1 billion (RM4.15 billion) upon its joint has effectively become the only ride-sharing service in the venture with Uber in the previous years (‘Grab expects to double region. Now, Grab has covered seven countries that include the revenue in 2019’, 2019). In Malaysia, there are 300,000 Grab car Philippines, Indonesia, Myanmar, Thailand, Vietnam, Cambodia, drivers with a minimum ride of RM5 and to date, Grab in and Malaysia. Other than providing e-hailing services, Grab has Malaysia has accumulated revenue of RM3.75 million (Nizar also embarked upon providing Grab Food (food delivery) and Ahmad, 2019). Starting the year 2019, Grab car drivers are Grab Express (parcel delivery) across the countries. required to register for the PSV license, which is a newly implemented e-hailing rule in Malaysia that costs RM800. Every country in the world has a different tax system; however, Nevertheless, out of 300,000 drivers, only 10% are currently the purpose of the tax system is similar for all countries, both registered with the PSV license (Nazrin, 2019). Besides, Grab car developed and developing, because taxes are the main sources of drivers are also required to pay taxes if the income they generate revenue for each country which are beneficial for the country’s from providing the service exceeds RM35,000. In fact, many development and its citizens. In the context of Malaysia, there are users prefer to use Grab cars as their medium of transportation; two types of taxes imposed, namely direct taxes and indirect hence, Grab car drivers, either part-timers or full-timers, must taxes. Direct taxes comprise the income tax, stamp duty, comply with the new rules by which they need to disclose their petroleum income tax, and real property gain tax. Meanwhile, Grab service income to the Inland Revenue Board Malaysia indirect taxes consist of the sales tax, service tax, as well as (IRBM) (‘Taxman tells Uber, Grabcar drivers to declare earnings’, export and import duty taxes (Income Tax Act, 1967). 2017). As such, this can help increase the country’s revenue In 2001, the government of Malaysia replaced implemented the alongside monitoring the Grab car drivers’ tax compliance. This Self-Assessment System (SAS) to replace the Official Assessment issue was widely discussed among of the policy makers System (OAS). In the Self-Assessment System, there are stages especially the outcomes of the tax compliance level in the local implemented for different taxpayer categories, such as corporate capital market, (Rashid, Noor, & Mastuki, 2015). taxpayers in 2001, followed by businesses, partnerships, and Anthony Tan, who is the youngest brother of the family-operated corporate in 2003, and also salaried individuals in 2004. To Tan Chong Motors, is the owner of Grab Car. Originated from compare the two systems, the Official Assessment System is done Singapore, Grab Car offers services ranging from ride-hailing, manually, whereby the taxpayers do not need to be ride-sharing, food delivery, to logistics via its application. His knowledgeable of their tax liability computation because the business began with the “My Teksi” application that was IRBM provides their annual tax returns based on the annual introduced in 2012 in Malaysia. In August 2013, his business assessment of tax income and expenses by applying tax laws and expanded, covering other Asian regions including the Philippines, regulations. Meanwhile, for the Self-Assessment System, it is Singapore, and Thailand in October. In 2014, Grab continuously necessary for taxpayers to have knowledge of taxation because expanded through collaboration with HDT Holdings; they not the system uses an electronic version for taxpayers to declare only introduced 100 electric taxis in Singapore, but they also and report their income and also to pay their taxes within the launched Grab service in Ho Chi Minh City and Jakarta. Later in stipulated time (Mohd Rizal, 2012). Consequently, the

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implementation of the Self-Assessment System not only reduces taxpayers’ awareness about the tax rules and regulations the burden of the tax authority and boosts the collection of (Oladipupo & Obazee, 2016). As stated by Bird (2014), income tax, but it has also simplified the tax process further knowledge is the learning process of understanding something because no physical documents are needed for the process (Palil that might also be influenced by motivation and other external & Mustapha, 2011). factors in relation to the information provided. In this case, taxpayers’ knowledge may influence their understanding of Table 1.1: Federal Government Revenue fulfilling their tax obligations accordingly. Furthermore, tax Category of tax 2018 (RM million) 2019 (RM million) awareness among taxpayers is also helpful for increasing their Tax revenue 174,700 176,152 compliance level (Muliari & Setiawan, 2011); the higher the tax Direct tax 133,474 135,068 awareness, the higher the level of tax compliance (Artiningsih, Indirect tax 41,226 41,084 2013). In order to ensure tax awareness, tax authorities must Non-tax revenue 61,760 85,662 play their roles effectively such as providing programs for the Total revenue 236,460 261,814 public in order to monitor the compliance rates and enhance the (Source: Ministry of Finance Malaysia, 2019) level of tax awareness. Hence, this study will examine the factors affecting tax As can be seen in Table 1.1, tax revenue contributed to almost compliance among Grab car drivers in Malaysia by focusing on 74% of the total revenue of the Federal Government in the years factors such as tax knowledge, tax awareness, tax morale, and tax 2018 and 2019. The main source of revenue, which is the direct penalty. It is anticipated that these four factors will influence tax tax, has a higher contribution compared to the indirect tax as the compliance among Grab car drivers in Malaysia. second source. According to OECD (2018), taxation is the major contributor to the country’s revenue source and it is also helpful LITERATURE REVIEW for the country’s continuous development. 1) Tax Knowledge and Tax Compliance Previous studies in Malaysia have emphasized that tax Nevertheless, tax compliance is still an ongoing issue due to the knowledge will determine a taxpayer’s compliance behavior fact that no one is as keen on paying taxes (Ali-Nakyea, 2014). under the tax system which called the self-assessment system Tax compliance is referred to as the willingness of taxpayers to (Loo, 2006). This is supported by other studies, which suggest disclose, report, and pay their tax liability according to the tax that possessing tax knowledge will encourage high rates of laws and regulations without any enforcement activity from the compliance (Kirchler, 2006). Through education, a taxpayer’s tax authority (James & Alley, 2012). Besides, tax compliance also knowledge can be enhanced (Alabede, Zainol Ariffin, & Idris, ensures that taxpayers such as individuals, businesses, and 2011); it helps the taxpayer to understand the tax requirements practitioners are responsible in terms of fulfilling and complying in filling the tax form before paying a tax. The issue arising is that with their tax obligations (SARS, 2012). Nevertheless, the taxpayers nowadays are still lacking tax knowledge or have interaction between taxpayers and tax authorities in dealing with limited knowledge regarding taxation. To solve this issue, the the compliance process will impact the actual level of tax responsible party such as the tax authority and the Government compliance (Kirchler, Muehlbacher, Kastlunger & Wahl, 2007; should provide a tax programme or put forward any solutions in Pickhardt & Prinz, 2014). order to increase the taxpayers’ knowledge of taxation. Hence, taxpayers with tax knowledge will comply with the applicable Tax compliance is defined as the full payment of all due taxes rules to complete their tax obligations. On the other hand, (Bidin et al., 2011). The best way to describe non-tax compliance taxpayers without tax knowledge seem very likely to refuse or is the difference between the total amounts of taxes due and the evade their tax obligations. actual amount of taxes paid by taxpayers. The difference could be due to overstating or understating income, expenses and Tax knowledge can be mainly divided into common or formal deduction on tax allowables. According to Cummings et al., education received as a matter of course and knowledge (2009), reasons for non-compliance include intentional evasion specifically directed at possible opportunities to evade tax (Grab, and unintentional noncompliance such as calculation errors and 2018). According to Cummings et al., (2009), it is essential for a inadequate understanding of tax laws. Taxpayers’ mistakes can person to be aware of taxation law. Tax knowledge is important be unintended; thus, do not necessarily represent attempts to to a voluntary compliance tax system particularly in determining evade (Abd Hamid et al., 2018), (Antonides and Robben, 1995) or accurate tax liability (Webley, 2004). Most recent studies could even lead to over reporting of tax. Correspondingly, tax undertaken in Malaysia (Abd Hamid et al., 2020) also state that compliance can be measured using several economic and non- tax knowledge is the most influential factor in determining economic factors such as tax knowledge, tax penalty, tax taxpayers’ compliance behaviour. This is because non- awareness, and tax morale. compliance behaviour among taxpayers either intentionally or unintentionally is due to the absence of tax knowledge. Tax morale is one of the factors that are able to affect tax compliance as it helps reduce the number of tax evaders. This is Mukhlis, Utomo, and Soesetio (2015) stated that tax compliance because tax morale is one of the voluntary approaches used to may be enhanced by tax knowledge. Most taxpayers with a high encourage taxpayers to pay their tax liability (Torgler, 2003). In level of knowledge tend to pay taxes as it is a mandatory addition, tax morale can be enhanced when taxpayers put their contribution and are intended to be doing so more frequently in trust in the government and tax authority. As such, tax order to spread the knowledge on filling tax returns correctly. authorities must give fair treatment to taxpayers so that public Through education, a taxpayer’s knowledge can be improved trust can be gained (Murphy & Tyler, 2008). Other than tax (Alabede, Zainol Ariffin, & Idris, 2011). Knowledge in relation to morale, the tax penalty is also one of the factors under the issues of rebates, relief, tax returns, and deduction from a variety economic approach that influences tax compliance (Sheikh Obid, of taxpayer categories may consist of joint assessment, business, 2014), which acts as a medium to prevent tax evasions. The and self-employed that can determine the level of a taxpayer’s penalty to be imposed on taxpayers is varied at certain rates; knowledge (IRBM, 2014). Basic tax knowledge can change hence, this might help increase the compliance rates depending on the current policies. According to the theory of simultaneously. planned behaviour, taxpayers with a high level of tax knowledge In Malaysia, the tax system applied uses an electronic version and a positive attitude towards tax knowledge may have greater and it is completely up to taxpayers’ responsibilities to disclose, intention to comply with the tax rules in order to fulfil their tax report, and pay their tax liability. As such, tax knowledge is obligations. Grab car drivers must have adequate knowledge in another factor affecting tax compliance. Tax knowledge refers to

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order to meet the tax obligation. From the literature discussed may become tax compliant when they are surrounded by above, Hypothesis 1 is constructed as follows: referent people that support what they do such as friends, family, H1: There is a positive significant relationship between tax or neighbours. Thus, it helps reduce the tendencies to commit tax knowledge and tax compliance among Grab car drivers in evasion while helping to increase tax compliance. Another aspect Malaysia. of tax morale is the taxpayers’ trust in authorities. The authority has to gain the trust of taxpayers by providing equality and 2) Tax Awareness and Tax Compliance effective provision of social welfare and development for the According to Palil et al. (2013), tax awareness is an important citizens and the country. This is because taxpayers expect the factor that can ensure the taxpayers to comply with tax rules and government to provide good services. Hence, it helps increase regulations. Hastuti (2014) defined tax awareness as a state of voluntary tax compliance among taxpayers. knowing or understanding of an individual to calculate, pay, and report his or her own tax. To improve tax awareness, it is in line Peichl (2013) stated that tax morale may influence tax with tax knowledge and tax education towards tax compliance. compliance. This is because tax morale tends to help taxpayers When a taxpayer has good knowledge of taxation, it helps to pay their taxes and reduce the number of individuals evading the increase the individual’s awareness and being ethical regarding tax (Organisation for Economic Co-operation and Development tax compliance. Hastuti (2014) mentioned that the effect of tax [OECD], 2018). Once taxpayers pay their taxes, this means that awareness will help taxpayers to understand more about the tax the taxpayers have a good attitude in terms of complying with system in order to calculate, pay, and report their income. the tax rules accordingly. Therefore, Grab car drivers should put Taxpayers may refuse or evade tax intentionally or some trust in the tax authority in order to receive fair treatment unintentionally due to taxpayers’ low tax awareness. However, and fulfil the tax laws. According to the theory of planned tax awareness may be increased if the taxpayers are concerned behaviour, the tax morale of taxpayers in terms of paying their about tax knowledge and tax educations towards tax compliance. taxes is affected by social norms. Hence, taxpayers may engage Nurlis (2010) described that taxpayers may increase their tax with tax compliance behaviour. From the literature discussed awareness towards tax compliance by encouraging the taxpayers above, Hypothesis 3 is constructed as follows: to be aware that paying tax will help improve the country’s H3: There is a positive significant relationship between tax development. As taxpayers refuse to pay taxes, the taxpayers will morale and tax compliance among Grab car drivers in Malaysia. know the consequence that the country’s development might be slightly affected. Besides that, taxpayers should not delay their 4) Tax Penalty and Tax Compliance tax payment because if the taxpayers made a delayed payment, According to Becker (1968), the economic deterrence approach lack of financial resources will occur and the development will was developed as it is an economic model used to prevent the become slower. Masruroh (2013) found that tax awareness non-tax compliance behaviour and encourages tax compliance influences tax compliance. Taxpayers that fully understand tax behaviour of the public in the country including Grab car drivers. function and tax benefits will pay taxes accordingly as well as They decided to be compliance under uncertain circumstances calculating, paying, and reporting their taxes voluntarily and due to the fear of the possibility of being caught and penalized accurately. By outlining some form of awareness to pay taxes, (Alm & McKee, 1998). Tax compliance issue was also discussed in this encourages taxpayers to pay taxes and comply with the tax the previous study as it meant for minimizing the leakages of laws. Furthermore, transparency of the form of tax payment government revenue, (Hamid et al., 2020). helps improve their awareness. Grab car drivers must show an ability to know and understand the tax laws deeply. Hence, it will Tax penalty, tax audit, and tax rate are used in most countries in help the Grab car drivers to disclose, file, and pay their taxes in a order to reduce taxpayers’ non-compliance behaviour. These timely manner. According to the theory of planned behaviour, three threats of punishment may influence the taxpayers to normative belief tends to help taxpayers to have a positive become tax compliant. In general, most prior studies have shown attitude if they are surrounded by others with good tax a positive correlation between audit probability and compliance awareness. Based on this discussion, it shows that tax awareness (Fischer, Wartick, & Mark, 1992). However, the impacts of audit assists taxpayers in adopting tax compliance behaviour. From the probabilities on tax compliance are varied depending on the literature discussed above, Hypothesis 2 is constructed as group of taxpayers. These because the tax compliance was also follows: closely related to the tax reporting level among of the tax payers, (Noor, Rashid, & Mastuki, 2011). H2: There is a positive significant relationship between tax Penalty rates will cause taxpayers to evade tax or avoid paying awareness and tax compliance among Grab car drivers in taxes. The higher the tax penalty, the higher the taxpayers’ Malaysia. tendencies to evade tax as it will encourage people to cheat (Kipicoech, 2014). Hence, it will be a greater possibility of tax 3) Tax Morale and Tax Compliance evasion. In addition, some studies suggest that increasing the tax OECD (2018) defines tax morale as taxpayer’s perceptions and penalty may lead people to commit tax avoidance (Kirchler, attitudes towards paying and evading taxes. Previous studies 2007). According to Wang (1988), some studies found that the have stated that there are three categories of tax morale that tax penalty does not influence tax compliance and there is no drive compliant taxpayers or non-compliant taxpayers. It conclusion on the effect of the tax penalty on tax compliance. consists of personal and social norms, trust in authorities, and According to the theory of planned behaviour, penalty rates and further socio-demographic controls. Firstly, the personal and the probability of detection on taxpayers’ non-compliance are social norms are an important factor in tax compliance (Hofmann not sufficient to affect the behaviours of taxpayers. Hence, Grab et al., 2008). Personal and social norms comprise personal car drivers may be imposed with a penalty if found to be values, ethical, religious beliefs, and ideas on what is a good or violating the tax obligations. For this reason, it is predicted to bad attitude. Social norms are shared beliefs on good or bad measure the significantly affect between tax penalty and tax decisions in accordance with tax compliance. Basically, taxpayers compliance. From the literature discussed above, Hypothesis 4 is constructed as follows: H4: There is a positive significant relationship between tax penalty and tax compliance among Grab car drivers in Malaysia.

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Figure 2.1: Research framework significance level α and the anticipated statistical power of 1-β. In this context of study, the program found out that 85 samples are needed to achieve a statistical power of 80% for detecting of R2 value of 0.15 with a chance of 5% of probability of error. The actual number of samples that responded to this study is 100 drivers. A sample of 100 drivers would be sufficient if the response rate of the survey is 100% as the minimum sample needed is only 85. However, a study in the Malaysian context had found that the response rate of the survey is 10% to 20% (Ramayah et al., 2011). Therefore, based on the experience of the researchers, this study has decided that the questionnaires would be distributed to 500 Grab car drivers with an expected return of 20%. Thus, the sample size was decided to include 500 Grab car drivers to ensure that a minimum of 100 respondents achieving the significant statistical results would be met.

MATERIALS AND METHODS 2) Analysis and Findings 1) Data Collection and Research Instruments In the descriptive analysis of demographic characteristics of There are several methods that can be used to determine the respondents, the Grab car drivers’ profile had analysed. This sample size. For this study, G*Power program will be chosen to analysis will provide the frequency and percentage of the determine the minimum sample size. The reason of choosing demographic characteristics. G*Power program is because this program consists of several advantages; the program is very user-friendly and it provides accurate prediction. The sample identified requires the

Table 3: Demographic Profile of Respondents Description Respondents (n=100) Percentage (%) Age 21-30 years/21-30 tahun 64 64.0 31-40 years/31-40 tahun 22 22.0 41-50 years/41-50 tahun 1 1.0 Above 50 years/50 tahun keatas 13 13.0 Education Level SPM 8 8.0 STPM 4 4.0 Certificate 4 4.0 Diploma 29 29.0 Degree 51 51.0 Masters 3 3.0 Others 1 1.0 Income Tax Payment Yes 44 44.0 No 56 56.0 Monthly Income Less than RM 2600/Kurang daripada RM 2600 81 81.0 RM 2600 and above/RM 2600 dan ke atas 19 19.0 Experience Less than 1 year 50 50.0 1 – 2 years 32 32.0 2– 3 years 16 16.0 Above 3 years 2 2.0 Status Full Time 30 30.0 Part Time 70 70.0

3) Validity Analysis information. For this study, the technique of factor analysis is The result of the validity test is obtained from using factor principle components analysis (PCA) as this study involve the analysis. Factor analysis a data reduction technique to reduce a research direction towards psychometrics, thus, PCA method large number of variables to a smaller essential set of variables will be used (Pallant, 2016). as it is to summarise the original variables into smaller new, composite dimensions or factors with a minimum loss of

Table 3.1: Validity Test using Factor Analysis Component 1 2 3 4 5 I am aware that tax penalties will be imposed if I do not comply. .824 I am aware that taxpayers are obliged to pay their own income tax liability. .796 I am aware to comply with all the rules of income tax/ .796 . I am aware to inform and declare actual income received from all sources to the tax authority. .768 I am aware that I had to register all my side income with IRBM/ .748 I know that IRBM will investigate anyone who is illegal in tax matters. .684 I know that individuals with annual income exceeding RM35,000 are required to pay taxes to .614 IRBM/ I am satisfy with the services given by IRBM. .862 IRBM tries to be fair when making their decisions .826 The trust I have in IRBM is very high .785 I agree with the decisions taken by IRBM .720 The penalties imposed recently are not enough to deter potential evader .584 I will declare the income honestly and pay a taxes on time .770

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I will responsible to pay the income tax to IRBM .765 Penalties should have been imposed if I was found guilty under the Tax Act 1967 .744 Non-compliance taxpayer need to pay substantial fine if IRBM detects tax evasion .641 Willingness to comply with all the tax regulations set by the IRBM .621 Non-compliance taxpayer can be imprisonment if found guilty evading tax .601 I pay tax to help the government to do worthwhile things .524 The E-filing system introduced by the IRBM facilitates taxpayers to manage their taxes online .812 The IRBM website provides tax information as a reference to taxpayers .810 The Malaysian tax system is good and not too complex .577 Income tax will be calculated from the total income of the remuneration as well as income from .625 other sources I understand the terms used in the income tax computation .611 % of variance 21.46% 17.46% 17.86% 10.96% 6.97% KMO Value 0.915 Bartlett’s Test of Sphericity Chi 2077.19 square .000 p-value

4 6 In order to test for the suitability of data for the structure Tax_Kno .26 .09 .223 2.7 .0 .4 2.2 detection, KMO and Bartlett’s Test of Sphericity is used (Laura, wledge 1 6 22 08 45 46 2011). The KMO and Bartlett’s Test analysed to determine the Tax_Awar .15 .08 .147 1.8 .0 .4 2.1 sampling adequacy for the variable (Stephanie, 2011). KMO value eness 0 1 46 68 69 33 more than 0.5 indicate that the sampling is adequate (Hair et al., Tax_Mora .28 .08 .300 3.5 .0 .4 2.3 2010). Meanwhile, Bartlett’s Test, the p-value must less than 0.05 le 7 0 82 01 23 63 and must be significant for factor analysis to be suitable (Hair et Tax_Pena .32 .09 .304 3.2 .0 .3 2.8 al., 2010). Based on Table 4.9, the KMO value is 0.915 and lty 5 9 89 01 49 65 Bartlett’s Test shows significant as the p-value is less than 0.05. a. Dependent Variable: Tax_Compliance Hence, the sample is adequate. The rotated component presented in Table 4.9, which consists of 5) Summary of Hypothesis Results five components that show a strong component. The five factors Based on Table 3.3 as follows, it is the summarization of rotation explained a total 74.70% of the variance; Factor 1 hypothesis results of this research. The results show that contribute 21.46% while factor 2,3,4,5 and 6 contribute 17.46%, hypotheses of the objective are supported partially where some 17.86%, 10.96% and 6.97% respectively. independent variables were proven to have a significant effect towards tax compliance. As the p-value of tax knowledge, tax 4) Regression Analysis (Coefficients) morale and tax penalty is less than.05, the result is significant. In order to identify multicollinearity issue, tolerance and the Hence, H1, H3 and H4 are supported. Meanwhile, tax awareness variance inflation factor (VIF) are two collinearity diagnostic is the only non-significant result as the p-value is more than.05. factors. The tolerance less than 0.2 will be multicollinearity issue Therefore, H2 is not supported (Hair et al., 2010). While for the VIF is less than 10, there will be no multicollinearity issues (Pallant, 2016). Values of VIF that Table 3.3: Summary of Hypothesis Results exceed 10 are often regarded as indicating multicollinearity. No Hypotheses P- Decision Since all of the variables state that in Table 3.2 does not have VIF value values of 10 and tolerance less than 0.2, it can be concluded that H1 There is a positive .008 Supported the model does not have multicollinearity issue. significant relationship

between tax knowledge As shown in Table 3.2 below, all of the independent variables are H2 and tax compliance among .068 Not significant to the dependent variable since the p-values (<.05) Grab car drivers in supported except for tax awareness. The result shows that there is positive Malaysia. significant linear relationship of tax knowledge on tax H3 There is a positive .001 compliance among Grab car drivers in Malaysia (t(95) = 2.722, p significant relationship Supported =.008). Next, the result shows that there is positive significant between tax awareness linear relationship of tax morale on tax compliance among Grab H4 and tax compliance among .001 car drivers in Malaysia (t(95) = 3.582, p =.001). After that, result Grab car drivers in Supported also shows that there is positive significant linear relationship of Malaysia. tax penalty on tax compliance among Grab car drivers in There is a positive Malaysia (t(95) = 3.289, p =.001). Meanwhile, the result shows significant relationship that there is no positive significant linear relationship of tax between tax morale and awareness on tax compliance among Grab car drivers in Malaysia tax compliance among (t(95) = 1.846, p =.068). Grab car drivers in

Malaysia. Table 3.2: Regression Analysis (Coefficients) There is a positive Unstandar Standar Collinear significant relationship dized dized ity between tax penalty and Coefficient Coeffici Statistics tax compliance among s ents Grab car drivers in Model B Beta t Si Toleranc Malaysia. Std.Error g. e VIF 1 (Constant - .25 - .8 ) .03 0 .13 92

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DISCUSSIONS AND CONCLUSIONS behavior in Malaysia. Journal of Finance, Accounting & The present study aims to examine the relationship between tax Management, 5(1), 109-124. knowledge, tax awareness, tax morale, tax penalty and tax 9. Alabede, J. O., Ariffin, Z. B. Z., & Idris, K. M. (2011). compliance among Grab car drivers in Malaysia. The findings of Determinants of tax compliance behaviour: A proposed this study revealed that effectiveness of tax authorities, tax model for Nigeria. International Research Journal of Finance transparency and public trust towards government are and Economics, Economics, 78(1), 121-136 significant to SST implementation acceptance. presented the data 10. Andreoni, J., B. B & J. F (1998) ‘Tax Compliance’, Journal of analysis finding using SPSS version 24 to examine the Economic Literature 36(2), 818– 860. relationship between tax knowledge, tax awareness, tax morale 11. Artiningsih. (2013). Pengaruh Kesadaran Wajib Pajak and tax penalty on tax compliance among Grab car drivers in Badan dan Pelayanan Perpajakan terhadap Kepatuhan Malaysia. Next, some several analyses and tests had been done in Wajib Pajak di KPP Pratama Sleman. Jurnal Akuntansi this study which are descriptive analysis, normality test, Keuangan. Vol 3 No 2: 38- 47. reliability analysis and multiple regression analysis. From the 12. Ali-Nakyea,A. (2014). Taxation in Ghana: Principles, results of multiple regression, it shows that tax knowledge, tax Practice and Planning. 3rd Edition, Black Mask Limited, morale and tax penalty significantly affect the level of tax Accra. compliance among Grab car drivers in Malaysia, and tax 13. Bird, R.M. (2014). Taxation and development: What have awareness does not significantly affect the level of tax we learned from fifty years of research? Public finance and compliance among Grab car drivers in Malaysia. It indicates that management, 13(4), 266-288. H1, H3 and H4 are supported for this study. 14. Byrne, B. M. (2010). Structural equation modeling with AMOS: Basic concepts, applications, and programming (2nd This study aims to examine all of the above particulars in relation ed.). New York: Routledge. to tax compliance behaviour and further adds some other factors 15. Chirkos, A.Y. (2014). A Comparative study of compliant and that might encourage taxpayers’ compliance, e.g. tax awareness. non-compliant individual taxpayers in Ethiopia evidence Tax awareness will influence tax compliance because it involves from Amhara region. Journal of Economic and Sustainable taxpayers’ beliefs, reasons, and knowledge to act according to the Development. 5(24) 10. tax system (Nurkhin et al., 2018; Savitri & Musfialdy, 2016; 16. Chow, C. Y. (2004). Gearing up for the self-assessment tax Suyanto & Trisnawati, 2016; Artiningsih, 2013). As such, if they regime for individuals. 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