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http://journals.sfu.ca/abr  ADVANCES IN BUSINESS RESEARCH 
2015, Volume 6, pages 14-31 

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14 
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The Effect of Espoused Culture on Acceptance of 
Online Tax Filing Services in an Emerging Economy 

Gaurav Gupta 
Pacific Lutheran University 

Syed K. Zaidi 
Midwestern State University 

Godwin J. Udo 
University of Texas at El Paso 

Kallol K. Bagchi 
University of Texas at El Paso 

 

This paper investigates the impact of espoused national culture on the individuals’ acceptance 
of online tax filing services in an emerging economy. This study integrates the theory of planned 
behavior and incorporates the impact of taxpayers’ trust and skepticism on their intentions to 
adopt online tax filing. This paper studies the moderating effect of espoused national culture on 
taxpayers’ intentions to e-file taxes using either government or private vendor tax filing portals. 
The results indicate that higher subjective norm, positive attitude, higher perceived behavioral 
control, and higher perceived trust are linked to higher intentions of adopting online tax filing.  

Keywords: Online tax filing; theory of planned behavior; espoused culture; skepticism; 
intentions; taxpayers. 

Introduction 

The purpose of this research is to examine the influence of espoused national culture on the 
acceptance of e-services (i.e., online tax filing) in a developing country. Udo and Bagchi (2011) argue 
that acceptance of technologies in developing countries cannot be simply assumed. They suggest 
that the cultural reasons behind the acceptance of online services need to be understood. The 
current research aims to explore the behavioral intentions of taxpayers1 to use government and other 
private vendor tax filing websites to file their taxes online. 

Wang (2002) argues that the use of online tax filing systems is limited regardless of the 
efforts spent to make these systems work better; therefore, it is important to understand the 
adoption of online tax filing systems in a country. Straub, Karahanna, Evaristo, and Srite (2002) state 
that India has strong internal cultural differences owing to the fact that it has over 14 official 
languages and hundreds of dialects. Moreover, India is made of not only several ethnic and religious 
subgroups but also possesses diverse cultural and racial characteristics (Walsham, 2002). Therefore, 
the existing cultural diversity in India may create significant differences in the mode of filing taxes in 
the country.  

Culture dimensions (Hofstede, 1980) have been extensively used to study cross-cultural 
differences among nations. These cultural dimensions (individualism-collectivism, power distance, 
masculinity-femininity, and uncertainty avoidance) at the individual level of analysis are termed as 

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1 Taxpayers, in this study, include tax-filers (i.e., individuals) who have filed other taxpayers’ taxes electronically. 



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espoused culture (Srite & Karahanna, 2006). Srite and Karahanna (2006, p. 681) define espoused 
culture as “the degree to which an individual embraces the values of his or her national culture.” 
Given the varied sub cultural groups in India, this research focuses on India. Moreover, India is one 
of the fastest developing emerging nations in the world. It is forecasted that India’s GDP will 
become the world’s second largest GDP by 2050 (O’Neill, 2007). Given the multi-cultural socio-
economic environment in India, it would be very interesting to understand factors that influence the 
adoption of online tax filing services.  

This research integrates the theory of planned behavior (Ajzen, 1991) and incorporates the 
impact of taxpayers’ trust (Gefen, Karahanna, & Straub, 2003) in the tax web vendors and 
skepticism (Hurtt, 2010) on their intentions to adopt online tax filing. This research also contributes 
to the literature by examining the influence of espoused national culture on acceptance of an 
accounting e-service, i.e. online tax filing in an emerging nation. One goal of this research is to 
understand how different sub-cultural groups in a multicultural country such as India would adopt 
online tax filing services. In addition to enhancing knowledge on adoption of electronic tax filing 
technology in a multicultural nation, this research may also have important policy implications for 
government of India in making technology diffusion decisions. The findings from this research will 
assist policymakers in making technology diffusion decisions in countries with multiple sub cultural 
groups.  

For successful diffusion of an online technology, it is imperative that the users willingly 
adopt such online technology. Fallan (1999) finds a positive correlation between increased tax 
knowledge of individuals and tax law compliance. Therefore, enhancing taxpayers’ knowledge is the 
antecedent of successful adoption of online tax filing.  

The remainder of the paper is structured as follows. Section 2 provides literature review and 
hypotheses development. Section 3 discusses research method. Section 4 analyzes the results. 
Section 5 provides discussion on findings. Section six provides conclusion.  

 
Literature Review and Hypotheses Development 

 
Online tax filing (i.e., e-filing) is relatively new in India. Indian federal government is making 

continuous efforts to improve the delivery of public services in cost effective ways. In 2006, the 
Indian government unveiled the National e-Governance Plan (NeGP) to make government services 
available to common people in India (Ojha, Sahu, & Gupta, 2008). With this in mind, the Income 
Tax department of India introduced the adoption of online tax filing. Currently, online tax filing is 
mandatory2 for a set of taxpayers. 
 A large number of web vendors in India are currently offering e-filing tax services to Indian 
taxpayers. Although some studies (Wang, 2002) tried to capture factors that can explain individuals’ 
intentions to file taxes online, they were limited in scope. This study develops a comprehensive 
model to evaluate factors that can explain taxpayers’ intentions to file taxes electronically. 
 
Theory of Planned Behavior (TPB) 

This study uses a comprehensive model based on prior accounting and information systems 
(IS) literature to examine factors that have an impact on taxpayers’ intentions to file taxes online. 
Pioneered by Ajzen (1991), the theory of planned behavior (TPB) is one of the most cited models 
used to explain behavioral intentions. TPB models individuals’ intentions to engage in specific 

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2For more details about mandatory e-filing requirements, please check the following website: 
https://incometaxindiaefiling.gov.in/!



ACCEPTANCE OF ONLINE TAX FILING SERVICES IN AN EMERGING ECONOMY!

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behavior as a function of the following three factors: subjective norms, attitude towards behavior, 
and perceived behavioral control. Behavioral Intentions are defined as “the strength of conscious 
plans to perform the target behavior” (Harrison, Mykytyn & Riemenschneider, 1997, p. 176). 
Subjective norms refer to an individual’s beliefs about whether their friends, family members, 
colleagues, superiors or significant others approve or disapprove a particular behavior (Ajzen, 1991). 
Attitude is defined as “an individual’s evaluation of the favorableness or unfavorableness of an 
attitude object” (Bobek & Hatfield, 2003, p. 17). Perceived behavioral control is defined as “people’s 
perception of the ease or difficulty of performing the behavior of interest” (Ajzen, 1991, p. 183).  
 
Culture 

Culture is a very broad construct. Scholars have used different approaches to measure it. 
Culture has been measured at different levels, i.e., individual level, organizational level, and national 
level. Schein (1992, p. 9) defines culture as “a pattern of basic assumptions-invented, discovered or 
developed by a given group…in relation to those problems.” Hofstede (1980, p. 25) defines culture 
as “the collective programming of the mind which distinguishes the members of one human group 
from another.” Based on a study of IBM employees, Hofstede (1980) identify four major 
dimensions of national culture: individualism-collectivism (IC), power distance (PD), uncertainty 
avoidance (UA), and masculinity-femininity (MF).  

These cultural dimensions are given unique cultural scores for different countries, which 
have been widely used by researchers to determine how nations differ from each other. At the 
individual level, Srite and Karahanna (2006) state that these dimensions can be labelled as espoused 
cultural dimensions3 (Udo & Bagchi, 2011). Many researchers (Bochner & Hesketh, 1994; Gomez, 
Kirkman, & Shapiro, 2000; Srite & Karahanna 2006; Udo & Bagchi, 2011; Yoon, 2009; Zhang & 
Maruping, 2008) have used espoused cultural values in their research. In a study of acceptance of 
online services in Nigeria, Udo and Bagchi (2011) conclude that some national espoused cultural 
values have moderated the relationships between predictors and outcome variables.  

In accounting literature, the impact of culture on accounting systems has been deeply 
studied. The framework for explaining the impact of culture on accounting systems was first 
proposed by Gray (1988). The author posits that shared cultural (or societal) values lead to shared 
accounting values (professionalism vs. statutory control; uniformity vs. flexibility; conservatism vs. 
optimism; secrecy vs. transparency) in a country and these accounting values explain the usage of 
different accounting systems in different countries.4 Thus, culture has been given prime importance 
in the accounting research. The concept of espoused national culture is relatively new in accounting 
filed. Therefore, it is imperative to explore how espoused national culture values can moderate the 
relationship between the predictor and outcome variables.  
 
Hypotheses Development 

In this section, several hypotheses are developed to explain the relationships identified in 
current study. Specifically, this study examines the direct influence of attitude, subjective norm, 
perceived behavioral control, trust, and skepticism on behavioral intentions to adopt online tax 
filing. In addition, Hofstede’s (1980) cultural dimensions are utilized to hypothesize the moderating 
effects of individualism-collectivism, power distance, masculinity-femininity, and uncertainty 
avoidance on the direct relationships identified in this study. The following sub-sections discuss the 
development of hypotheses. 

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3!For more discussion on espoused cultural dimensions, review Srite and Karahanna (2006).!
4!For more discussion, review Gray (1988).!



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Skepticism. The level of skepticism is more likely to influence individuals’ intentions to use 
the online tax payment system for filing taxes. Skepticism is relatively a newer construct, but is 
gaining popularity in accounting research. In marketing literature, skepticism is “a trait that 
predisposes individuals to doubt the veracity of various forms of marketing communication, 
including advertising and public relations” (Forehand & Grier, 2003, p. 349). Skepticism, a 
characteristic of an individual, can also influence an individual’s intentions to use online tax payment 
system for making tax payments. Massey, Khatri, and Montoya-Weiss (2007, p. 282) argue that 
“skeptics tend to be dispassionate about technology, but also have a few inhibitions; thus, they need 
to be convinced of benefits.” The definition suggest that skeptical taxpayers are less likely to utilize 
online tax filing services. Hence, the following hypothesis is proposed: 

 
H1:  High (Low) skepticism leads to lower (higher) intentions of using online tax payment 

system for filing current year or future year income taxes. 
 

Trust. Trust has an impact on the adoption of online services. Online consumers are 
different from traditional consumers, who had opportunity to interact with seller and inspect the 
quality of a product before buying it. Pavlou and Chai (2002, p. 240) state that the “the spatial and 
temporal separation between consumers and web vendors increase fears of seller opportunism due 
to product and identity uncertainty.” Online consumers perceive greater risk in online shopping 
since they cannot observe actions or behaviors of online vendors (Reichheld & Schefter, 2000). 
Gefen et al. (2003) argue that trust is an important factor in influencing repeat consumers’ intentions 
to engage in an online activity. Therefore, there exist a positive relationship between consumers’ 
perceived trust in web vendors and behavioral intentions to engage in online activity. This suggests 
that an increased trust in online tax payment systems positively impact taxpayers’ intentions to adopt 
electronic tax filing systems. Hence, the following hypothesis is proposed: 

 
H2: High perceived trust in online tax vendors leads to higher behavioral intentions of 

filing taxes online. 
 

Theory of Planned Behavior. TPB, an extension of the theory of reasoned action, has 
been successfully tested in prior research. Harrison et al. (1997) find that TPB model can be used in 
understanding small businesses executives’ intentions to make IT adoption decisions. Pavlou and 
Fygenson (2006) and Dowling (2009) also utilize TPB. The Pavlou and Fygenson (2006) propose a 
business-to-commerce (B2C) e-commerce adoption model based on the extended TPB and find 
considerable support for this theory. Therefore, the following hypotheses are developed: 

 
H3:  Higher subjective norms lead to higher intentions of using online tax payment 

system for filing current year or future year income taxes. 
H4:  Positive attitude towards behavior leads to higher intentions of using online tax 

payment system for filing current year or future year income taxes. 
H5:  Higher perceived behavioral control leads to higher intentions of using online tax 

payment system for filing current year or future year income taxes.  
 

Culture. National culture has been a topic of research across nations. Hofstede (1980, p. 25) 
defines culture as “the collective programming of the mind which distinguishes the members of one 
human group from another.” The pioneer work of cultural influence on accounting systems was 
conducted by Gray (1988). Doupnik and Tsakumis (2004) present a thorough review of papers 
(Salter & Niswander, 1995) that test Gray’s model of cultural influence on accounting systems. 



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Doupnik and Tsakumis (2004, p. 1) state that “culture is a powerful environmental factor that 
affects the accounting systems of a country as well as how individuals perceive and use accounting 
information.” However, accounting literature has largely ignored the impact of the presence of sub-
cultures within a country on the outcome variables. This study examines the moderating effects of 
Hofstede’s (1980) cultural dimensions (PD, IC, UA, and MF) on intentions to adopt online tax 
filing. 

Power distance: Power distance is an important cultural factor for India (House, Hanges, 
Javidan, Dorfman, & Gupta, 2004). The government of India realizes the power distance among 
different classes. In order to lift the socio-economic status of the lower classes, the government has 
reserved a fixed percentage of seats in the country’s higher education institutions for students 
applying from lower classes (Desai & Kulkarni, 2008). Desai & Kulkarni (2008) further provide that 
similar reservations have been made for them in government jobs and politics. Therefore, studying 
the impact of espoused power distance among various groups in India is well justified. 

At the individual level, high espoused power distance means that individuals perceive status 
gap between superiors and subordinates, and try to follow orders of their superiors (Udo & Bagchi, 
2011). Moreover, the subjective norm of the TPB in context of present research shows the impact 
which an individual taxpayer’s friends, colleagues, superiors, and family members have on 
influencing his/her intentions to adopt online tax filing system. Therefore, it is expected that 
espoused power distance to moderate the relationship between the subjective norm and intentions 
to adopt e-filing of taxes. Therefore, the following hypothesis is proposed: 

 
H6a: Espoused power distance moderates the relationship between subjective norm and 

intentions to adopt electronic tax filing. 
 
Yoon (2009) states that in low power distance countries, superiors and subordinates are 

interdependent because they are more likely to consider each other equal. Given this 
interdependence, superiors and subordinates will exhibit more interpersonal trust. Thus, it is 
hypothesized that the relationship between trust and behavioral intentions of taxpayers is moderated 
by espoused power distance. The following hypothesis is proposed: 

 
H6b:  Espoused power distance moderates the relationship between trust and intentions to 

adopt electronic tax filing. 
 
Individualism-Collectivism: In-group collectivism refers to “the degree to which individuals 

express pride, loyalty, and cohesiveness in their organizations or families” (House et al., 2004, p. 30). 
Thus, individuals with high espoused collectivism (or low espoused individualism) are more likely to 
be concerned about what group members have to say about their actions. Thus, espoused 
collectivism may moderate the relationship between subjective norm and behavioral intentions to 
adopt online tax filing. Hence, the following hypothesis is developed: 

 
H7:  Espoused collectivism moderates the relationship between subjective norm and 

intentions to adopt electronic tax filing. 
 
Uncertainty Avoidance: The Globe study defines uncertainty avoidance as “the extent to which 

members of collectives seek orderliness, consistency, structure, formalized procedures, and laws to 
cover situations in their daily lives” (House et al., 2004, p. 603). The Globe study (House et al., 2004) 
states less resistance to change as one of the characteristics of weak uncertainty avoidance 
orientation. Hofstede (2001) posits that high uncertainty avoidance individuals are more 



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uncomfortable in dealing with unpredictable and unstable situations. Also, online consumers 
perceive greater risk in online shopping as they cannot observe the actions or behaviors of online 
vendors (Reichheld & Schefter, 2000). It is hypothesized that taxpayers with higher espoused 
uncertainty avoidance will be more uncomfortable in unpredictable situations and are more likely to 
perceive risk in online tax filing as compared to taxpayers with lower espoused uncertainty 
avoidance. Thus, espoused uncertainty avoidance is expected to moderate the relationship between 
trust in online tax vendor and behavioral intentions to adopt online tax filing. Therefore, the 
following hypothesis is developed: 

 
H8:  Espoused uncertainty avoidance moderates the relationship between trust in online 

tax vendor and behavioral intentions to adopt electronic tax filing. 
 
Masculinity-Femininity: Udo and Bagchi (2011) state that masculinity refers to the extent to 

which a society or a group encourages masculine characteristics such as assertiveness, ambition, and 
competitiveness, against feminine characteristics such as caring, relationships, etc. Further, Udo and 
Bagchi (2011, p. 32) posit that “Individuals with feminine-type of traits are likely to assign much 
importance to an online service system that is perceived to be easy to use than individuals with 
masculine-type traits, as it is a quality-of-work life issue.” Therefore, it is argued that the higher the 
espoused masculinity, the smaller the effect of attitude on behavioral intentions to adopt e-filing for 
taxes. Hence, the following hypothesis is developed: 

 
H9:  Espoused masculinity moderates the relationship between attitude and intentions to 

adopt electronic tax filing. 
 

Research Method 
 

This is a survey study. The study uses WarpPLS 4.0 to perform partial least square structural 
equation modeling (PLS SEM). Several independent variables are used to examine taxpayers’ 
intentions to file taxes electronically. The following sections provide description of variables, model, 
and sample. 

 
Variables 

The dependent variable is taxpayers’ intentions to file taxes online. Independent variables 
include skepticism, trust, subjective norms, attitude, and perceived behavioral control. This study 
adapts the instruments from Ajzen (1991), Pavlou and Fygenson (2006), and Hurtt (2010) to 
measure the constructs for subjective norm, trust, attitude, perceived behavioral control (PBC), and 
skepticism. The moderating variables include power distance (PD), individualism-collectivism (IC), 
uncertainty avoidance (UA), and masculinity-femininity (MF). The constructs for moderating 
variable are adapted from Hofstede (1980). 
 
Model 

Based on extant accounting and information systems literature, this study develops a 
comprehensive model to explain taxpayers’ intentions to file taxes online (Figure 1). The model 
shows the impact of trust, subjective norms, attitude, skepticism, and perceived behavioral control 
on taxpayers’ intentions to file taxes online. In addition, the figure also shows moderating variables: 
PD, IC, UA, and MF. 

 



ACCEPTANCE OF ONLINE TAX FILING SERVICES IN AN EMERGING ECONOMY!

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Sample 
This is a survey study. Snowball sampling technique is used for data collection purpose. This 

research uses two main criteria to select participants. First, participants should be earning income. 
Second, participants should be filing tax returns. The final sample includes 201 participants from 
various organizations in India. A majority of participants were male. Table 1 provides detailed 
demographic information about the respondents. 
 
Figure 1: Taxpayers’ model 

 
 

The questionnaire5 consists of several parts. Most parts in the survey were based on 5-point 
Likert scale, where respondents were asked to rate between 1 (low, strongly disagree, bad idea, or 
very foolish) and 5 (high, strongly agree, good idea, or wise). One part of the survey was based on 6-
point Likert scale, where respondents were asked to rate between 1 (strongly disagree) and 6 
(strongly agree). The variation in this scale is due to the fact that the instruments from different 
sources were adapted. 

 
 
 
 

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5!The items for perceived behavioral control (PBC) were adapted from Pavlou and Fygenson (2006). The authors 

state that “PBC has two distinct dimensions: self-efficacy and controllability” (Pavlou & Fygenson (2006, p. 119). 
This research combines the items of self-efficacy and controllability to measure PBC.!



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Table 1: Background of respondents 
Total Responses  201 surveys 
Gender Female 43 respondents (21.4%) 
 Male 156 respondents (77.6%) 
 No response 2 respondents (1%) 
Age Less than 18 years 0 respondents 
 18-24 years 51 respondents 
 25-35 years 95 respondents 
 36-50 years 51 respondents 
 Over 50 years 4 respondents 
Internet Experience  6.98 years (average) 
Work Experience Average number of years 7.65 years (161 respondents) 
(Accounting Related Field) No response/other 40 respondents 
Work Experience Average number of years 4.85 years (163 respondents) 
(Non-Accounting Field) No response 38 respondents 
Online Tax Filing  Personal 108 respondents 
Experience Corporate (business) 13 respondents 
 Other 11 respondents 
 Personal and corporate (business) 44 respondents 
 Personal and other 2 respondents 
 Corporate (business) and other 2 respondents 
 Personal, corporate (business), and 

other 
19 respondents 

 No response 2 respondents 
Current Employment Accounting related field 145 respondents  
 Non-accounting related field 55 respondents  
 No response 1 respondent 
Annual Income Less than INR200 000 31 respondents 
 INR200 000-1 000 000 132 respondents 
 More than INR1 000 000 33 respondents 
 No response 5 respondents  
Language English 66 respondents 
 Hindi 57 respondents 
 Other 3 respondents 
 English and Hindi 69 respondents 
 English and Other 2 respondents 
 English, Hindi, & Other 3 respondents 
 No response 1 respondent 
 

Analysis and Results 
 

Table 2 shows model fit indices. Average path coefficient (APC), average r-squared (ARS), 
and average adjusted r-squared (AARS) are all significant at 1% level which suggests a good model 
fit. Average block variance inflation factor (AVIF) and average full collinearity variance inflation 
factor (AFVIF) are 1.468 and 1.494, respectively. The both are in the ideal range (<=3.3), which 
shows model’s overall predictive and explanatory quality. The Tenenhaus goodness of fit (GoF) is 
0.523 which is greater than the large cut-off point of 0.36. Therefore, the model has a higher 



ACCEPTANCE OF ONLINE TAX FILING SERVICES IN AN EMERGING ECONOMY!

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explanatory power. Simpson’s paradox ratio (SPR) of 1.000 is in the ideal range (>=0.7) suggesting 
that 100.0% of the paths in the model are free from Simpson’s paradox or causality problem6. The r-
squared contribution ratio (RSCR) is very close to ideal range. Statistical suppression ratio (SSR) and 
nonlinear bivariate causality direction ratio (NLBCDR) are in the acceptable range.  

 
Table 2: Model fit and quality indices 
Model Fit Indices 
Average path coefficient (APC) 
Average r-squared (ARS) 
Average adjusted r-squared (AARS) 
Average block variance inflation factor (AVIF) 
Average full collinearity variance inflation factor (AFVIF) 
Tenenhaus goodness of fit (GoF) 
Simpson's paradox ratio (SPR) 
R-squared contribution ratio (RSCR) 
Statistical suppression ratio (SSR) 
Nonlinear bivariate causality direction ratio (NLBCDR) 

0.136*** 
0.542*** 
0.518*** 
1.468 
1.494 
0.523 
1.000 
1.000 
1.000 
0.800 

***P<0.01 
 

In addition, all indicator and cross loadings for both latent and interaction variables are 
significant which suggests that they are passing confirmatory factor analysis (CFA). Block variance 
inflation factors (VIF) are also below the threshold of 3.3 which suggests that there is no vertical 
multicollinearity in a block of latent variables (Kock & Lynn, 2012). 

A few questions were failed to load at the acceptable levels and therefore, were dropped 
from further analysis. Table 3 reports factor loadings and Cronbach’s alphas of the constructs used 
in this study. The Cronbach’s alphas for all of the constructs are greater than 0.60.  Nunnally (1967) 
suggests that the reliability of 0.50 to 0.60 is sufficient.   

 
Table 3: Factor loadings 

Construct and Indicators Loadings Cronbach’s Alpha 

Masculinity-Femininity 
• It is preferable to have a man in high level position rather than a 

woman. 
• There are some jobs in which a man can always do better than a 

woman.    
• It is more important for men to have a professional career than it is 

for women to have a professional career. 
• Solving organizational problems requires the active forcible approach 

which is typical of men. 
• Women do not value recognition and promotion in their work as 

much as men do. 
 
 

 

0.795 
 

0.703 
 

0.871 
 

0.808 
 

0.705 

0.836 

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6!Simpson’s paradox is a situation that “occurs when a path coefficient and a correlation associated with a pair of 

linked variables have different signs” (Kock, 2013, p. 49). It is the indication of a causality problem. It suggests 
that “a hypothesized path is either implausible or reversed” (Kock, 2013, p. 49). 



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Construct and Indicators Loadings Cronbach’s Alpha 

Individualism-Collectivism 
• Being accepted as a member of a group is more important than having 

autonomy and Independence.   
• Being accepted as a member of a group is more important than being 

independent. 
• Group success is more important than individual success.  
• Being loyal to a group is more important than individual gain. 
• Individual rewards are not as important as group welfare.   
• It is more important for a manager to encourage loyalty and a sense of 

duty in subordinates than it is to encourage individual initiative. 

 

0.769 
 

0.675 
 

0.708 
0.682 
0.538 
0.565 

0.738 

Power Distance 
• Managers should make most decisions without consulting 

subordinates.  
• Managers should not ask subordinates for advice, because they might 

appear less powerful. 
• Decision making power should stay with top management in the 

organization and not be delegated to lower level employees. 
• Employees should not question their manager’s decisions. 
• A manager should perform work which is difficult and important and 

delegate tasks which are repetitive and mundane to subordinates.  
• Higher level managers should receive more benefits and privileges 

than lower level managers and professional staff.  
• Managers should be careful not to ask the opinions of subordinates 

too frequently, otherwise the manager might appear to be weak and 
incompetent. 

 

0.802 
 

0.759 
 

0.561 
 

0.721 
0.529 

 
0.659 

 
0.582 

0.785 

Uncertainty Avoidance 
• Rules and regulations are important because they inform workers 

what the organization expects of them.  
• Order and structure are very important in a work environment.     
• It is important to have job requirements and instructions spelled out 

in detail so that people always know what they are expected to do.    
• Providing opportunities to be innovative is more important than 

requiring standardized work procedures. 

 

0.745 
 

0.732 
0.786 

 
0.625 

 

0.695 

Trust 
• The tax website vendor would continue to be honest in its dealings in 

future. 
• For me, it is important for tax website vendors to be honest in their 

dealings with their customers. 
• For me, it is important for tax website vendors not to take advantage 

of their customers.  
• This tax website vendor would not seek to take advantage of me if I 

continue to file taxes using it.  

 

0.623 
 

0.814 
 

0.696 
 

0.630 

0.637 

Subjective Norm 
• Most people who are important to me think it is a good idea to file 

taxes online. 

 

0.913 
 

0.799 



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Construct and Indicators Loadings Cronbach’s Alpha 

• Most people who are important to me would file taxes online. 0.913 

Attitude 
• Filing taxes online would be (a bad idea/a good idea). 
• Filing taxes online would be (very foolish/wise). 

 

0.899 
0.899 

0.762 

Skepticism 
• I wait to decide on issues until I can get more information. 
• The prospect of learning excites me. 
• I am interested in what causes people to behave the way they do. 
• I often reject statements unless I have proof that they are true. 
• I am confident about my abilities. 
• Discovering new information is fun. 
• I take my time making decisions.  
• I like to understand the reason for other people’s behavior. 
• I think that learning is exciting. 
• I have confidence in myself.  
• I do not like to decide until I’ve looked at all of the readily available 

information. 
• I like searching for knowledge. 
• I like to ensure that I have considered most available information 

before making a decision. 
• I enjoy trying to determine if what I read or hear is true. 
• I enjoy learning. 
• The actions people take and the reasons for those actions are 

fascinating. 

 

0.600 
0.788 
0.559 
0.545 
0.524 
0.559 
0.738 
0.632 
0.800 
0.530 
0.608 

 
0.714 
0.693 

 
0.672 
0.757 
0.557 

0.905 

Perceived Behavioral Control 
• All necessary resources for filing taxes online are accessible to me. 
• Filing taxes online is completely under my control. 
• If I wanted to, I would be able to file taxes online. 
• If I wanted to, I am confident I could file taxes online. 

 

0.783 
0.635 
0.780 
0.845 

0.759 

Behavioral Intentions 
• Given both the options to file taxes online and manually (paper-

based), I intend to use online tax filing frequently. 
• Given both the options to file taxes online and manually (paper-

based), I intend to recommend online tax filing to other people. 
• Given both the options to file taxes online and manually (paper-

based), I intend to use online tax filing service whenever I have a 
need. 

 

0.855 
 

0.817 
 

0.847 

0.791 

 

This study examines construct validity using convergent and discriminant validity. Table 4 
reports the correlations among latent variables with square roots of average variance extracted 
(AVE). Udo, Bagchi, and Kirs (2010) suggest that a construct demonstrates the convergent validity 
when AVE is at least 0.50. Table 4 shows the AVE values in the diagonal. All values are greater than 
the cut-off point of 0.50. Therefore, the constructs displays convergent validity. This research also 



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evaluates combined loadings with cross-loadings and structure loadings with cross-loadings to assess 
convergent validity. All loadings are greater than 0.5 and their associated p-values are lower than 
0.05 (Hair, Anderson, & Tatham, 1987; Hair, Black, Babin, & Anderson, 2009), which suggests that 
instrument has a good convergent validity.  

To assess discriminant validity of a latent variable, Fornell & Larcker (1981) suggest that all 
correlations of that latent variable should be less than the square root of the AVE. The results show 
that the square root of the AVE of any latent variable is greater than any of the correlations of that 
latent variable. Thus the construct displays convergent and discriminant validity (Table 4).  

This study uses partial least square structural equation modeling to test the hypotheses 
(Figure 2). The results for H1, high (low) skepticism leads to lower (higher) intentions of using 
online tax payment system for filing current year or future year income taxes, are not found to be 
significant (p=0.21). Therefore, H1 is not supported. However, this research finds support for H2, 
perceived trust is positively and significantly (P<0.01) associated with behavioral intentions to adopt 
online tax filing. 

Consistent with H3, results suggest that subjective norm is positively and significantly 
(P<0.01) associated with behavioral intentions to adopt online tax filing system. Consequently, H3 is 
supported. The results show a positive and significant (P<0.05) association between attitude and 
behavioral intentions to adopt online tax filing system. Therefore, H4 is supported. In addition, the 
results show support for H5. The relationship between perceived behavioral control and behavioral 
intentions is positive and significant (p<0.01). Overall, this study finds strong support for the 
hypotheses related to the theory of planned behavior. 

 
 
 

Table 4: Correlations among latent variables (diagonal represents square root of AVE values) 
 

Su
bj

N
or

m
 

T
ru

st
 

A
tt

it
ud

e 

In
te

nt
 

P
D

 

IC
 

U
A

 

M
F

 

Sk
ep

t 

C
on

tr
ol

 

SubjNorm  0.913          
Trust  0.186***  0.695         
Attitude  0.464***  0.214***  0.899        
Intent  0.543***  0.376***  0.438***  0.840       
PD  0.051 -0.099 -0.126* -0.194***  0.666      
IC  0.276***  0.229***  0.213***  0.126*  0.071 0.661     
UA -0.052  0.245***  0.106  0.017  0.043 0.248***  0.724    
MF  0.080 -0.054 -0.038 -0.062  0.331*** 0.074 -0.024  0.779   
Skept  0.127*  0.342***  0.205***  0.220*** -0.188*** 0.266***  0.282***  0.015 0.649  
Control  0.606***  0.342***  0.489***  0.551***  0.122* 0.233***  0.108 -0.028 0.203*** 0.765 
*** Significance at p < 0.01; ** Significant at p < 0.05; * Significant at p < 0.10 
 
 
 



ACCEPTANCE OF ONLINE TAX FILING SERVICES IN AN EMERGING ECONOMY!

26 
!

 
Figure 2: Confirmatory analysis model with results 

 
 

Contrary to H6a, the results show significant (p<0.01) but negative relationship between 
subjective norm and intentions to adopt electronic tax filing moderated by espoused power distance. 
Therefore, H6a is not supported. Similarly, no support is found for Hypothesis 6b. The results show 
significant (p<0.01) but positive relationship between trust and behavioral intentions moderated by 
power distance. The relationship between subjective norm and intentions to adopt electronic tax 
filing moderated by espoused collectivism is not found to be significant (p<0.13). Therefore, H7 is 
not supported. Furthermore, the results show no support for H8. The results show significant 
(p<0.10) but positive relationship between trust and behavioral intentions moderated by uncertainty 
avoidance. Hypothesis 9 in the area of cultural dimensions is related to masculinity-femininity. The 
results show significant (p<0.10) but positive relationship between attitude and behavioral intentions 
to adopt online tax filing moderated by masculinity. 

Overall, the results (Table 5) show that perceived trust, subjective norm, attitude, and 
perceived behavioral control are positively and significantly associated with behavioral intentions to 
adopt online tax filing. However, the association between professional skepticism and behavioral 
intentions of filing taxes online is not statistically significant. No support for hypotheses in the area 
of espoused cultural dimensions is found.   

 
Discussion 

 
This study examines the influence of espoused national culture on the acceptance of e-

services (i.e., online tax filing) in a developing country. Udo and Bagchi (2011) suggest that cultural 
reasons behind the acceptance of online services need to be understood. This study aims to explore 



! ! Gupta et al. 

27 
!

behavioral intentions of taxpayers to use government and other private vendor tax filing websites to 
e-file their taxes. This research uses Hofstede (1980) cultural dimensions, integrates the theory of 
planned behavior (Ajzen, 1991), and incorporates the impact of trust (Gefen et al., 2003) in tax web 
vendors on tax filers’ skepticism (Hurtt, 2010) towards accepting online tax filing. The study 
contributes to literature by examining the influence of espoused national culture on acceptance of an 
accounting e-service, i.e. online tax filing in an emerging nation. 
 
Table 5: Results 

Hypotheses Supported 
H1: High (Low) skepticism leads to lower (higher) intentions of using online tax 

payment system for filing current year or future year income taxes. 
No 

H2: High Perceived Trust in online tax vendor leads to higher behavioral 
intentions of filing taxes online.  

Yes 

H3: Higher subjective norms lead to higher intentions of using online tax 
payment system for filing current year or future year income taxes. 

Yes 

H4: Positive attitude towards behavior leads to higher intentions of using online 
tax payment system for filing current year or future year income taxes. 

Yes 

H5: Higher perceived behavioral control leads to higher intentions of using 
online tax payment system for filing current year or future year income 
taxes.  

Yes 

H6a: Espoused power distance moderates the relationship between subjective 
norm and intentions to adopt electronic tax filing.  

No 

H6b: Espoused power distance moderates the relationship between trust and 
intentions to adopt electronic tax filing. 

No 
 

H7: Espoused collectivism moderates the relationship between subjective norm 
and intentions to adopt electronic tax filing. 

No 

H8: Espoused uncertainty avoidance moderates the relationship between trust in 
online tax vendor and behavioral intentions to adopt electronic tax filing.  

No 

H9: Espoused masculinity moderates the relationship between attitude and 
intentions to adopt electronic tax filing. 

No 

 
The level of individual’s skepticism has an influence on individual’s intentions to adopt 

online tax filing system. It is hypothesized (H1) that higher (lower) skepticism leads to lower (higher) 
intentions of using online tax payment system for filing current and future year income taxes. This 
study expects to find a negative relationship between skepticism and behavioral intentions to adopt 
online tax filing system. However, no support is found for this hypothesis. A reduced number of 
items to measure the skepticism scale could be a possible cause for this. Skepticism is a 30-item 
scale. However, a number of items are unable to load on the scale, and therefore, are dropped from 
further analysis. The final skepticism scale consists of only 16 items.  

Trust can influence repeat consumers’ intentions to engage in online activities (Gefen et al., 
2003). Therefore, the study expects to find a positive relationship between the consumers’ perceived 
trust in the web vendor and the behavioral intentions to engage in online activity. Consistent with 
H2, the results show that increased trust in online tax payment system is positively associated with 
taxpayers’ intentions to adopt online tax payment system.  

The next three hypotheses (H3, H4, and H5) are related to the theory of planned behavior 
(TPB). Harrison et al. (1997) use TPB model to understand executives’ intentions to make IT 
adoption decisions. Pavlou and Fygenson (2006) also use TPB model and find considerable support 



ACCEPTANCE OF ONLINE TAX FILING SERVICES IN AN EMERGING ECONOMY!

28 
!

for this theory. The results suggest that higher subjective norms lead to higher intentions of using 
online tax payment system (H3). The results also show that positive attitude towards behavior leads 
to higher intentions of using online tax payment system for filing current year or future year income 
taxes (H4). Hypothesis H5, which suggests that there is a positive relationship between perceived 
behavioral control and behavioral intentions to adopt online tax filing system, is also supported. 
Overall, the results suggest that higher subjective norms, positive attitude, and higher perceived 
behavioral control lead to higher behavioral intentions to adopt e-filing system. Therefore, H3, H4, 
and H5 are supported. 

Furthermore, it is hypothesized (H6a) that espoused power distance moderates the 
relationship between subjective norm and taxpayers’ intentions to adopt electronic tax filing. The 
study expects to find that the higher the espoused power distance, the larger the effect of subjective 
norm on taxpayers’ behavioral intentions to adopt online tax filing. However, contrary to H6a, 
significant but negative relationship is found. Furthermore, Yoon (2009) states that in low power 
distance countries, superiors and subordinates are interdependent because they are more likely to 
consider each other equal. Given this interdependence, superiors and subordinates will exhibit more 
interpersonal trust. Due to the increased trust, this study posits that the higher the espoused power 
distance, the smaller the effect of trust on taxpayers’ behavioral intentions to adopt online tax filing. 
However, contrary to H6b, significant but positive relationship between trust and behavioral 
intentions moderated by power distance is found. This suggests that the higher the espoused power 
distance, the larger the effect of trust on taxpayers’ intentions to adopt online tax filing. Hypothesis 
6b is not supported. 

Furthermore, Individuals with high espoused collectivism are more likely to be concerned 
about what group members have to say about their actions. Therefore, the study posits that the 
higher the espoused collectivism, the larger the effect of subjective norm on taxpayers’ behavioral 
intentions to adopt online tax filing. However, results show no support for H7. Hypothesis 8 
suggests that the higher the espoused uncertainty avoidance, the smaller the effect of trust on 
taxpayers’ behavioral intentions to adopt online tax filing. However, contrary to H7, the results show 
significant but positive relationship between trust and behavioral intentions to adopt online tax filing 
moderated by uncertainty avoidance. This suggests that the higher the espoused uncertainty 
avoidance, the larger the effect of trust on taxpayer’s behavioral intentions to adopt online tax filing. 

Furthermore, the study hypothesize that espoused masculinity moderates the relationship 
between the attitude and intentions to adopt electronic tax filing. Udo and Bagchi (2011) propose 
that individuals with feminine characteristics are more likely to assign greater importance to online 
service system because of the quality of work-life issue. Therefore, the higher the espoused 
masculinity, the smaller the effect of attitude on taxpayers’ behavioral intentions to adopt online tax 
filing. However, contrary to this hypothesis, the results show significant but positive association 
between attitude and behavioral intentions to adopt online tax filing moderated by espoused 
masculinity. This suggests the higher the espoused masculinity, the higher the effect of attitude on a 
taxpayers’ behavioral intentions to adopt online tax filing.  
 

Conclusion 
 

This paper examines the impact of espoused national culture on the individuals’ acceptance 
of online tax filing services in India. The study integrates the theory of planned behavior (Ajzen, 
1991), trust (Gefen et al., 2003), professional skepticism (Hurtt, 2010), and cultural dimensions 
(Hofstede, 1980) to evaluate their influence on taxpayers’ intentions to file taxes electronically. 
Specifically, this study examines the moderating effect of espoused national culture on taxpayers’ 



! ! Gupta et al. 

29 
!

intentions to file taxes online using either government or private vendor tax filing portals. To test 
the impact of culture, trust, skepticism, attitude, perceived behavioral control and subjective norm 
on taxpayers’ behavioral intentions to adopt online tax filing, several hypotheses are developed. 
Partial support is found for the proposed hypotheses (Table 5). 

This research enhances knowledge on adoption of electronic tax filing technology in a 
multicultural nation. It also provides insights on important policy implications for government of 
India in making technology diffusion decisions. Findings from this research will help policymakers 
in making technology diffusion decisions in countries with diverse subcultural groups. In addition, 
this study provides guidance about the increased need for government efforts to enhance taxpayers’ 
knowledge of tax laws. Enhancing taxpayers’ knowledge may be required before successful adoption 
of online tax filing system.  
 

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Dr. Gaurav Gupta is an Assistant Professor of Business-Accounting and teaches accounting 
courses in the BBA, MBA, and MSF programs at Pacific Lutheran University. He earned his Ph.D. 
from the University of Texas at El Paso, an M.B.A. from Pepperdine University, and a B.Com 
(Honors) degree from the University of Delhi, India. He also holds CMA designation from the 
Institute of Management Accountants [IMA]. 

Dr. Syed K. Zaidi is an Assistant Professor of Accounting at Midwestern State University, Wichita 
Falls, Texas. He teaches cost and managerial accounting courses. His primary area of research is 
behavioral accounting. Dr. Zaidi holds a Ph.D. in international business with a specialization in 
Accounting from the University of Texas at El Paso, an M.B.A. from California State University San 
Bernardino, a B.S. from California State University Long Beach, and a B.B.A. from the University of 
Peshawar, Pakistan. Dr. Zaidi also holds CFE and CMA designations. 

Dr. Godwin J. Udo is a Professor of Information Systems in the College of Business 
Administration at the University of Texas at El Paso. He holds a Ph.D. in industrial management 
from Clemson University. He is the author of over 120 research articles in the areas of technology 
transfer, computer security, IT adoption and management, and decision support systems.  

Dr. Kallol K. Bagchi is a Professor of Information Systems in the College of Business 
Administration at the University of Texas at El Paso. He received his Ph.D. in information systems 
from the Florida Atlantic University. Prior to pursuing his IS doctorate, he had earned a Ph.D. 
degree in Computer Science from India. He has published in a variety of journals. His current 
research interests include IT adoption and diffusion, values, global IT, software engineering.  

 


