Value-Added Tax System: the Relationships between Tax Informational Approaches and Other Factors on the Knowledge and Attitudes of Vat-Registered Individual Taxpayers in Davao City

This is a descriptive-correlational method of study aimed at finding the relationships between the VAT informational approaches and other factors on the knowledge and attitudes of VAT-registered individual taxpayers in Davao City, Philippines toward the VAT system. This study attempted to answer the following questions: 1. What are the different tax informational approaches as source of knowledge of VAT-registered individual tax payers toward the VAT system? 2. What is the level of basic technical knowledge and course of attitudes of VAT-registered individual taxpayers toward the VAT system? 3. Is there a significant relationship between the knowledge and attitudes of the taxpayers toward the tax system and the following approaches: (a) public communication; (b) mass media communication; (c) two-person communication; and, (d) small group communication? 4. Is there a significant relationship between the knowledge and attitudes of the taxpayers toward the tax system and the following politico-administrative factors: (a) other tax services; (b) tax enforcement activities; and, (c) disposition of government funds? 5. Are the relationships between knowledge and attitudes of taxpayers and the informational approaches and politico-administrative factors influenced by the following factors: (a) age; (b) education; (c) religion; (d) membership in social organizations; (e) type of business; and, (f) reliance on other persons? 6. Which of these informational approaches and other factors contribute to the basic technical knowledge and course of attitudes of taxpayers toward the VAT system, singly or collectively? The statistical tools used in the research were the percentage, the average weighted mean, the multiple correlation and the stepwise regression. Interpretations were based on the two-tailed test (0.05 level of confidence) and Garret?s description of the computed r-values (Appendix 1). Samples of the study were 260 VAT-registered individual taxpayers in Davao City, selected by simple random sampling technique, and the computer software used in this study was the Microstat. The analyses and interpretation of the data gathered in this study yielded the following findings: 1. All of the respondents obtained their knowledge on the VAT system from the following informational approaches: public, mass media, two-person and small group communications. 2. The respondents? level of basic knowledge on the VAT system was interpreted as high (average weighted mean = 3.89). However, the taxpayers? acceptance of the benefits or advantages of taxation, as well as the losses or disadvantages from it drove their attitude to the point of neutrality (average weighted mean = 3.14). 3. The three informational approaches ? public, mass media and two-person communications disclosed significant relationships with both knowledge and attitudes of taxpayers. These findings affirmed the importance of tax seminars, print broadcast media, as well as tax information disseminated by either the accountants/bookkeepers or revenue personnel in the formation of both knowledge and attitudes of taxpayers toward the VAT system. 4. Politico-administrative factors like other tax services, tax enforcement activities of the BIR and the disposition of government funds have significant relationships with the taxpayers? knowledge and attitudes. Among these factors, the disposition of government funds strengthened the taxpayers? knowledge and attitudes. 5. Taxpayers? personal factors such as educational attainment and memberships in social organizations contributed to the enhancement of their knowledge on the VAT. On the other hand, age was a negative contributor to attitude, meaning the older these taxpayers were, the more critical they were with the tax system. Conversely, memberships in social organizations and reliance on other persons in transacting business with the BIR, positively affected their attitudes toward the VAT system. 6. Considering the informational approaches, politico-administrative and personal factors, the factors that best contributed to taxpayer?s knowledge on the VAT were: public communication, education, membership in social organizations, mass media communication, other tax services and two-person communication. Furthermore, the factors that strongly affected their attitudes toward the VAT system were: disposition of government funds, tax enforcement activities, age, public communication, membership in social organizations and reliance on other persons.