Academy of Accounting and Financial Studies Journal (Print ISSN: 1096-3685; Online ISSN: 1528-2635)


Will tax simplification lead to more compliance?

Author(s): Gail Young

Orientation It has been said that the fundamental paradox of tax simplification is that, despite consensus, almost every year tax rules become more complex, and by increasing the complexity it can become overwhelming for the taxpayer to comply with the provisions. Research purpose This paper seeks to consider whether tax simpilifcation can be a tool to increase compliance. It is aknowledged that simplification is multi-faceted and can be addressed from several areas. Motivation for the study The focus of the paper is to address the understandability and readability of tax legislation to increase compliance. This paper considers tax simplification measures which have been implemented internationally to provide a basis for a recommendations in which tax systems could be simplified. Research approach and methods A doctrinal methodology is applied, and an analysis is carried out of possible tax simplification measures, based on the commentary of experts in the field of tax law. Main findings This paper considers the international trends to provide a basis to reduce the complexity found in tax legislation which could lead to an increased tax compliance. Several measures were identified which could be implemented to address the current areas of complexity experienced globally. Some of these measures include the re-writing of tax legislation using simpler language when drafting legislation, aligning legislation to international standards and simiplfying the structure of the legislation. Practial implications The research outlines the measures which could be implemented to achieve tax simplification. Contribution This research highlights that tax simplification needs to be prioritized to achieve increased compliance and reap the other benefits associated with tax simplification. The paper provides recommendations to contribute to achieving the goal.

Get the App