Microsoft Word - Manuskrip 6_Ilman.docx Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 54 Self-Assessment System in Indonesian Taxation: Weakness or Strength? 1 Muhammad Ilman Iriawan Fitdra, Inayati 1 University of Indonesia; Indonesia; muhammad.ilman01@ui.ac.id Received: January 11, 2022; In Revised: May 8, 2022; Accepted: June 17, 2022 Abstract This study describes the challenges of compliance in the formation of tax morality. This study examines the literature on self-assessment and tax compliance. This study explores a scientific review of tax compliance based on the application of a self-assessment system (SAS). All relevant data that is combined into information is revealed in this study by ensuring all components that need to be clarified about self-assessment and its implications for tax compliance. The conclusion of the study shows that in Indonesia, SAS is a tax system that requires a high level of tax compliance. The high and low levels of tax compliance can be caused by tax knowledge and system complexity. Keywords: Self Assessment, Tax Morale. Tax Compliance Introduction Tax revenue is the backbone of a country. Many factors can affect tax revenue, one of which is the ease of tax administration, which includes registration and tax payments. The system's application is intended so taxpayers can carry out their tax obligations, such as calculating, paying, and reporting their taxes independently. However, the implementation of the self-assessment system also has several problems, such as taxpayer non-compliance. For example, in a study conducted in Kenya by Mulugeta (2016) regarding taxpayers' perceptions of the self-assessment system, the following conclusions were obtained; taxpayers view the self-assessment system as complex because of their inability to understand tax laws, for example, tax rates, receipt, and payment dates. They also feel that the amount of tax they need to pay is unfair, and they even believe that other people are not paying their taxes honestly. The existence of these things encourages someone to be disobedient in paying taxes. This problem is critical to be resolved because non-compliance in paying taxes will affect the amount of tax that should be obtained. Osman (2011) argues that taxpayers choose the alternative that maximizes their expectations after the tax return. This is because taxpayers make calculations of the monetary consequences of compliance alternatives such as avoiding taxes or not, the probability of being detected, and the consequences. Hendy (2013) says that companies at all times view the consequences of non-compliance with taxes, such as tax penalties, interest, and penalties, as an avoidable expense for their industry. Therefore, they make arrangements to ensure that they act by state tax requirements. In line with Bajwa's view, late submission of SPT will result in the company being fined. It can be considered that this penalty is a material cost and failure to submit tax obligations on time also attracts interest in addition to the principal amount. This increases the costs incurred in a business, thereby reducing profitability and making taxpayers comply. Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 55 According to Kicher (2013), taxpayers always work hard to increase their profits by considering threats that can be found and reprimanded for non-compliance activities related to tax requirements. This opinion is in line with the thought of Kidder and Craig (2011). It must be acknowledged that high fines can be one of the factors that make tax avoidance more dangerous for taxpayers. However, Alm (2013) and Lewis, Webley & Furnham (2013) prove otherwise. According to them, taxpayers do not have a sense of deterrence with the fines given to a policy of fines and penalties based on prevention can be more effective when combined with frequent audits. However, Indonesia implements a self-assessment system, and therefore few audits are carried out because the system is based on taxpayers' trust. Problems in compliance often occur in the tax world. Based on Waluyo (2020), one of the indicators of taxpayer compliance can be seen from the Tax Return (SPT) submission. Waluyo also stated that the request of SPT never reached 100%. In 2018 there were more than 35 million registered taxpayers, but only 17 million submitted SPT and from private individuals, only 10 million proposed SPT. Thus, taxpayer compliance in 2018 was only 63.9%. The compliance issues underlie this research because increasing tax compliance is essential in running a good tax system. Other studies have also been conducted to analyze various factors affecting tax compliance, such as tax knowledge. The study by Prince and Anayduba (2014) found that tax knowledge significantly influences the level of taxpayer compliance. In addition, the level of compliance can also be seen from the side of taxpayers' tax morale because according to Maheasy and Deden (2018) tax morality is the basic motivation that can affect taxpayer compliance. Thus, the higher the tax morale, the higher the level of tax compliance that occurs. Many studies on compliance have been completed by researchers. However, this paper focuses on how to improve compliance through technology as the world has entered the digital era. Theoretical Basis Implementation of Self Assessment System A self-assessment system is an assessment procedure based on the assumption that all information provided by the taxpayer is correct and does not need to be checked by the revenue officer (Kasipillai, 2010). One of them is the view that the Self-Assessment System (SAS) creates a partnership between taxpayers and authorities where authority tasks are to examine, control, and settle returns. Osman (2011) believes that this system simplifies tax collection and increases compliance levels, although some experts such as Dziro (2016); Aryeetey & Ahene (2014) believe otherwise. An active self-assessment system requires certain conditions that must be fully met (Mulugeta, 2016), such as tax knowledge of taxpayers, simplicity of the taxation system, effective law enforcement and tax sanctions, good service to taxpayers, and simple filing procedures. Osman (2011) argues that the most essential aspect that needs to be considered for effective self-assessment is something related to social morals, namely honesty. In addition, Osman (2011) emphasizes that the payment of full obligations is very dependent on the taxpayer's loyalty and awareness. Mulugeta (2016) shows that the effectiveness of the tax sanctions and audit policies carried out and the simplicity of the self-assessment system requirements in privileging taxpayers' time and resources as the main determinants of the self- assessment system. Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 56 Self - assessment system provides an opportunity for taxpayers to calculate their tax obligations. Thus, taxpayers can use this to manipulate tax returns that cause tax non- compliance/evasion (Hasseldine & Li, 2014). In addition, Richardson (2016) emphasizes that the self-assessment system is implicated in non-compliance behaviour and possible contributing factor to the tax gap. In a study conducted by the International Monetary Fund (2013), in the UK there is a 14% tax gap resulting from income taxes from SMEs and 30% value-added tax (VAT). Developed countries struggle to reduce the tax gap through a self-assessment system. The large number found in the audits conducted shows the percentage of SMEs contributing to the tax gap through abuse of the self-assessment system (Beesoon & Hemavadi, 2016). Tax Morale According to Maheasy and Deden (2018), tax morale is the fundamental motivation that can affect taxpayer compliance. Luttmer and Singhal (2014) also explain that primary motivation can be; intrinsic motivation related to personal satisfaction, reciprocity between citizens and government, long-term cultural factors, the influence of friends and society, and imperfect information.On the other hand, according to Torgler and Schneider (2004), tax morale is an intrinsic motivation so taxpayers can voluntarily contribute to the provision of public goods by complying and paying. Therefore, tax morale is not measured by individuals but by the attitudes and stances that exist within an individual. These attitudes and stances are more touching on the side of individual awareness in carrying out their obligations. One of the obligations is to pay taxes that have been imposed. Torgler and Schaltegger (in Mahcepat and Deden, 2018) also mention that tax morale helps explain high levels of tax compliance. It was explained that tax morale measures individual behaviour and tax evasion measures personal attitudes, so a sustainable tax system is needed based on a fair tax system and responsive government. This is achieved if there is a strong relationship between taxpayers and the government. In addition, tax compliance views are often based on views on law enforcement issues. According to the OECD (2013), people who believe in their government have a higher level of tax morale than people who don't. In addition, the OECD also stated that people who favour the democratic system of the government consider cheating on taxes unjustified. The explanations above show how closely related tax compliance is to tax morale. Tax Compliance Tax compliance is a significant problem for many tax authorities. It is not easy to persuade taxpayers to comply with tax requirements even though the tax laws are not always appropriate (James & Alley, 2014). Tax compliance can be referred to as a process in which an SPT that must be submitted to the tax authorities is filed promptly with accurate tax obligations as required in a country's tax laws and regulations (Friedman, 2011). Tax compliance can also be interpreted as the ability and willingness of taxpayers to comply with tax laws and regulations, namely declaring the correct income each year and paying the right amount of tax. Alm (2013) suggests that tax compliance is the actual reporting of income in which the compliance behaviour is influenced by the taxpayers' ignorance. The taxpayers will enjoy tax savings due to unreported income in the short term without considering the amount paid in the long term for the unreported income. A declared at a penalty rate that would be higher than the amount they would pay if they declared the correct income at the right time. Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 57 Tax non-compliance is referred to as evasion by Namusonge, Biraori & Kipicoech (2014). Kicher (2013) defines tax non-compliance as failure to comply with the law and misreporting of income. Taxpayers vary in terms of the opportunities available to them in overestimating expenses and understating income (Baldry, 2011). Lumumba & Migwi (2010) argue that the non-compliance of some taxpayers is based on a lack of knowledge about tax issues which is taxpayer non-compliance. Meanwhile, according to Jayawarden (2015), psychological factors are one of the main factors that determine tax compliance behaviour Self Assessment System is very dependent on the attitude of the taxpayer. Therefore, it faces a wider risk of non-compliance by taxpayers. The attitude of taxpayers towards taxes through the self-assessment system and its contribution to the tax gap is one of the main objectives of this study because it relates to taxpayer compliance and their perception of the actual reporting of obligations. Tax Knowledge Education level has something to do with tax democratization. This is evident in the work of Prince & Anayduba (2014) who found a positive relationship between education and tax democratization. This is also supported by other authors such as Witt and Woodbury (2013), etc. Tax knowledge is essential in achieving voluntary compliance, especially in determining the obligations paid in a self-assessment system environment (Kasipillai, 2010). Kicher (2013) has conducted various studies that prove that knowledge ownership increases tax compliance. Knowledge of violation awareness, rebates, penalty rights, and fines correlate with taxpayer behaviour in the research of Palil & Mustapha (2010). Method This research was written using a qualitative approach. Then the researcher uses a type of literature study research, namely by describing the data obtained from a number of primary literatures such as journals of national and international repute. In the process, the researcher collected at least 43 articles, most of which came from reputable international journals. Results And Discussion System Complexity Masasirambi (2013) explains that the increasing problem of tax democratization is the result of the preparation of a complex tax system that cannot be operated and interpreted by taxpayers. Kicher (2013) adds that the modern taxation business system can be quite burdensome, especially for small and medium enterprises. Guest (2012) also explains that the three main elements of the tax burden are the process of implementing taxation among taxpayers while also explaining that the competent costs that arise due to compliance are called the costs of democracy that arise. Due to the taxes' payment and in conclusion, there are expenses associated with the operation of a particular tax system, The tax system in Indonesia is not that complicated. Indeed, Indonesia uses a self- assessment system as its taxation system, but that does not mean it is not easy to implement. For example, in the case of an employee's income tax, where the employee can receive a salary without having to calculate the tax again because the tax has been calculated and reported by the office, however, the taxpayer should still have an obligation to report the tax. However, once the employee's taxpayer has been deducted by the company, the taxpayer usually still does Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 58 not report the withholding income tax because it is considered an obligation that has been taken care of by the office. This raises issues on the lack of tax knowledge for people who have never calculated their taxes. The lack of knowledge does not only cause people to have no ability to calculate taxes but also cause people not know how the tax treatment applies. Plus, there is now a digital tax system where taxpayers can pay taxes, and report them online. This can indeed make it easier for people to carry out their tax obligations. Yet, it also raises problems for taxpayers who do not understand technology. Consequently, the Indonesian tax system is not complicated. Nevertheless, it can be difficult if people do not understand how to carry out their tax obligations. Ignorance is also a problem because people who do not know eventually become indifferent to tax procedures, and this ignorance is dangerous. In the end, people are easily provoked because they do not know how to implement it. Taxpayer Knowledge of System As explained above, knowledge of the system is vital. Thus, taxpayers need to be equipped with tax knowledge that allows them to comply with tax regulations. Tax knowledge is necessary to increase tax democratization and will also help record keeping in business as well as in creating a conducive business that allows compliant business actors to operate freely. It is hoped that business actors can increase their knowledge of the tax system so that tax democratization can be formed when they obtain relevant tax knowledge and education. Increased knowledge about the tax system is also one way to improve tax compliance among businesses and individuals through increased tax education and tax application among businesses. Kicher (2013) concludes that the reason why tax compliance rates are low in Africa is due to a lack of adequate tax education and if improved, Palil and Mustapha (2010) explain that tax knowledge has a positive effect on tax compliance. Kassim (2013) also suggests that providing relevant knowledge to taxpayers will result in them fulfilling their tax obligations as and when they are due. According to Palil & Mustapha (2010), tax compliance can be improved through the provision of education to taxpayers that makes them aware of their social responsibilities to influence them to comply. He further explained that tax compliance is affected by public cooperation. There are many benefits associated with helping taxpayers fulfill their tax obligations through significant improvement in the information provided or by providing them with more tax knowledge through, for example, TV campaigns. It equips taxpayers to become more responsible citizens and can generate better tax revenue increases than using the money for law enforcement activities. Indonesia itself is lacking in terms of providing information to the public. For example, Indonesian people will not understand the tax system if they are not people who handle their taxes or people who are close to taxes. This issue happens due to the lack of information obtained by the public. For example, the information circulated by the tax authority is usually in the form of the amount of tax collected or about the program carried out by the tax authority, but the procedure or even the legal basis of the program itself is not informed and usually can only be known when the taxpayer comes to the tax office. Another thing if people want to know about taxes is to take education related to taxes and that can only be done when one has reached college. Tax knowledge has a significant and positive relationship with tax democratization. This means that a high level of tax knowledge will increase voluntary compliance. It also shows that knowledge and awareness of taxation play an essential role among taxpayers and influence tax Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 59 democratization. Tax knowledge is an effective tool to encourage taxpayers to be more obedient. Some researchers also state that if taxpayers are equipped with relevant tax knowledge, their willingness to comply will increase. Therefore, it can be concluded that tax democratization can be increased by providing relevant tax education and it will reduce tax tendencies to avoid taxes. Palil & Mustapha (2010) found that tax knowledge has a positive effect on tax democratization, but the level of tax knowledge is not significant among respondents. Therefore, taking more measures to provide tax knowledge to a large part of society helps in the prevention of tax evasion and results in the promotion of voluntary tax compliance. In contrast, poorer tax knowledge is associated with negative attitudes towards taxation and an increased tendency to avoid taxes. Tax knowledge is usually related to the ability of taxpayers to understand and comply with tax regulations or not. Knowledge can be divided into two elements; general fiscal knowledge and specific fiscal knowledge related to tax avoidance opportunities. What is important and needs to be emphasized is that through increasing general knowledge of taxation, the attitude of taxpayers improved and this results in the creation of a positive attitude towards taxation, which leads to increased tax compliance. On the other hand, making taxpayers aware of how they can manipulate tax regulations will hurt tax compliance because it helps promote tax democratization. Some explained that taxation knowledge significantly influences the democratization of tax regulations. Moreover, this brings a positive relationship between taxation knowledge and tax democratization. Economists find that tax democratization of tax policy is higher in the group with people who are equipped with tax knowledge and tax knowledge has a greater impact on tax compliance. Therefore, he concludes that as a result of adequate tax knowledge, knowledgeable taxpayers file SPT on time, unlike the uneducated taxpayers. According to several researchers, knowledge of taxation positively affects tax democratization. He also conveyed the importance of having a high level of tax awareness because it would impact a high level of tax democratization and vice versa. Therefore, general knowledge of taxation is vital as a basis for understanding tax laws and regulations to comply with them Taxpayer Knowledge About Tax Law Knowledge of taxpayers and even the public on the applicable regulations is very important. As previously mentioned, Indonesia adheres to a self-assessment system where taxpayers must carry out their tax obligations such as calculating, paying, and self-reporting. However, this is not easy because one of the factors is knowledge of the applicable tax rules. Tax rules that apply and circulate can indeed be owned by anyone, but not everyone can understand these regulations. Richardson (2016) explains that it is essential for people to understand tax law because it shapes their disposition to comply. He also explained that in general the law is seen as complex, this has resulted in taxpayers being reluctant to try to understand the tax laws and regulations. Many people have difficulty understanding the messages contained in the tax law, the level of their better understanding depends on the knowledge one has about the field of taxation knowledge (Saad, 2012). This shows that in terms of implementing the self-assessment system, the community must have tax knowledge with high qualifications in general so that they can interpret tax regulations better, which positively affects tax knowledge. It also explains that the inability to understand tax law can result in impartiality to tax law. Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 60 Therefore, tax authorities need to make efforts to simplify tax laws by rewriting tax regulations into language that is easily understood by taxpayers. However, the complexity of tax regulations is a challenge through the creation of uncertainty in interpreting tax regulations, resulting in a high level of tax non-compliance. It is concluded that the level of tax democratization can be affected when the taxpayer does not know the number of non- compliance actions detected by the relevant tax authorities in carrying out their tax audits. Due to the lack of adequate tax knowledge, most business actors and taxpayers use tax consultants and lawyers to prepare their tax returns. This results in high democratic costs that may deter taxpayers from complying. Therefore, equipping taxpayers with tax knowledge will reduce tax democratization and produce more compliant taxpayers. Inadequate knowledge of taxation and uncertainty of tax law causes taxpayers to apply incorrect tax provisions in preparing their returns. Some mentioned that if taxpayers are provided with relevant tax knowledge, their willingness to comply will increase. He concluded that tax democratization could be enhanced through the provision of relevant tax education and would reduce tax evasion tendencies. The study wants to assess the understanding of tax law as a challenge to implementing other alternatives to improve tax democratization through a self-assessment system. Income Level Another factor that contributes to non-compliance is the level of income concluded by authors such as Dubin & Wilde (2014) as the root cause of utilizing the self-assessment system as an ongoing taxation system. Beck & Levine (2015) also said that the justification behind the entire taxation system is in line with the two main theories of taxation, namely; The Payability Principle and the Equal Distribution Principle. This is because, basically, no one wants to pay taxes, let alone pay them. Once someone finds out that their activities have a taxation impact, of course, that person will feel displeased. The same thing is also experienced by people who have only enough income for their daily needs. Several studies have examined that the level of income does affect tax compliance. Some of the results of these studies explain that someone will be reluctant to pay taxes when their income is low and the reason these people use is that their income is only enough for their daily meals. According to Indonesian regulations, not all taxpayers need to pay taxes. Unfortunately, according to the community, it can be said to be less facilitating because the exception to not paying taxes is mostly found in the income earned by individuals. If a taxpayer opens a micro, small, or medium-sized business, there are different tax rates and can be taxed. The general public does not know even this tax exemption, this is due to a lack of knowledge of applicable taxation. So actually, the self-assessment system is an excellent system to implement as long as the community has adequate knowledge and continues to grow, this is because tax regulations can change very quickly. Efforts To Improve Tax Compliance The digital age rapidly changes the relationship between tax authorities and taxpayers (Kassim, 2013). Driven by the desire to generate more revenue, greater efficiency, and better compliance in an environment of shrinking resources, tax authorities are increasingly relying on digital tax data collection and analysis using digital platforms to facilitate real-time collection and assessment of taxpayers. or near real-time (Liu & Ye, 2013). This tax digitization allows tax authorities to collect real-time or near-real-time tax data; they can then use that information to respond quickly and in a more targeted manner to the perceived compliance risk. According to some researchers, when taxpayers file their taxes Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 61 online, they will create permanent electronic records for future use. Instead, they can get their information on the computer and get to work immediately. HM Revenue and Customs (2016) also supports the Digital Tax System, saying that it brings more accuracy, online filing takes a lot of the guesswork out of the tax return process, and many programs even do the calculations. Digital tax systems make the filing process faster, and the last thing most taxpayers want to do is spend days and weeks sifting through papers to file their returns. So when taxpayers file their taxes online, it will speed up the process, saving them a lot of time and frustration. He goes on to say that filing your taxes online ensures you'll get your refund as soon as possible. Core Tax System The core tax system is the central record system in tax administration and the main driver for automation and direct processing. It provides technical support, at various levels, for all tax administration functions, processing registration applications and issuing taxpayer- identification numbers that validate and process returns and payments received through different channels, maintaining taxpayer accounts, providing tools to identify and pursue delinquent taxpayers, automating appeals tracking and provide taxpayer service staff with access to taxpayer information to enable a better level of service to taxpayers. Indonesia has also started using this system. This is shown by the way taxes in Indonesia can be done online. For example, the Indonesian tax return reporting system has implemented e-filling so taxpayers no longer need to come to the tax office to make payments and report taxes. However, Indonesia still requires NPWP as a taxpayer identity, and this is quite inefficient, this is because as a result of having an NPWP, Indonesian taxpayers have various kinds of identity cards. It would be better in the future if the NPWP and NIK could be used as one for all taxpayers in Indonesia. Easy Registration According to Nyamwanza et al. (2014), registration is a process in which the tax administration collects basic taxpayer identity information, such as name, address, and type of legal entity. This information is very important because it allows the tax administration to know who the taxpayers are, where they are and whether they are active or inactive. According to Kidder & Craig (2011), modern tax administrations also collect compliance information, such as types of business activity or turnover forecasts, to plan for future tax democratization. Most tax administrations obtain registration certificates during registration and provide new taxpayers with information about their filing and payment obligations. Hendy (2013) asserts that the basic registration functionality of the tax information technology system includes the storage and maintenance of taxpayer identity information, automatic issuance of Taxpayer Identification Numbers (NPWP) and taxpayer certificates, as well as automatic determination of taxpayer filing requirements. This shows how important tax information is for a taxpayer, because this information will be very important in terms of information exchange activities from taxpayers. Digital Tax integrates cross-tax registration to allow a single view of taxpayers during audits or collections, centralizes the registration database to enable effective non-compliance monitoring, provides a single facility for taxpayers to register all taxes to simplify tax democratization, and interfaces with electronic tax systems enabling taxpayer new taxes to register online. Richardson (2016) asserts that a single, centralized taxpayer registration database also enables precise planning, enabling tax administrations to rationalize staffing and resources based on the active taxpayer population's size and geographic location. Many of these tasks would not be possible without IT. Publica: Jurnal Pemikiran Administrasi Negara P-ISSN 2085-6555 Vol 14 No. 1 | Juni 2022: 54-64 E-ISSN 2715-9256 =========================================================================== Dodi Pramana, Nelly Armayanti, Rita Dialusi Gultom Policy Impact Analysis of The Harapan Family Program to Improve a Poor Household Welfare in PardomuanVillage Onanrunggu District Samosir Regency 62 Farik (2011) argues that digital taxation systems in some cases allow taxpayer information to be cross-referenced and shared among governments and institutions. However, he said businesses with outdated systems or businesses that cannot adapt quickly may face increased risk, unexpected costs, and compliance challenges they are not prepared to respond to. According to EY (2017), some countries are leading the digital revolution, others are forming a second wave, and others are years away from embracing digitalization. In Indonesia, we are situated in the second wave because the current system already uses an e-filing system. Conclusion Implementation of a self-assessment system can lead to convenience in tax administration but can also cause problems. Therefore, it is necessary to increase the knowledge of taxation owned by taxpayers. The higher the level of knowledge of taxpayers on tax rules and the applicable tax system, the higher tax compliance. In addition to increasing knowledge about taxes, it is also necessary to boost the tax morale of taxpayers by using technology. Thus, the existence of technology should help the government manage taxes, so it is essential to use technology that can provide convenience for taxpayers. References Alm, J. (2013). Why Do People Pay Taxes? Journal Of Public Economics, 48(1), 21-38. Aryeetey, E. & Ahene, A. (2014). Changing Regulatory Environment For Small And Medium Size Enterprises And Their Performance In Ghana. Baldry, J.C. (2011). Income Tax Enforcement. 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