Taxpayer awareness and service boost compliance, but sanctions fall short.
The study looked at how taxpayer awareness, fiscal service, and tax sanctions affect individual taxpayer compliance. They surveyed over 34,000 taxpayers in Medan Belawan and found that awareness and good service from tax offices can increase compliance. However, the threat of tax sanctions alone doesn't seem to have a significant impact. Overall, these factors can explain 46% of why people comply with their taxes, with other factors playing a role as well.