A Proposal Model for a Jordanian Taxpayer to Improve Value Added Tax Compliance Among Retail Industry: Evidence from Jordan

Tax compliance has been a problem since the beginning of taxes. It is still an important topic in academic and professional literature. There are two kinds of past studies on following or not following taxes: economic and social/psychological theories. Tax evasion is a big problem for governments everywhere, including Jordan. Jordan has tried to improve compliance within its country by implementing various financial measures over the past few years. However, annual reports show that the country is still experiencing a significant increase in its total debt and financial deficit. This can be attributed to the rise in tax evasion. This is very true for Jordan's Value Added Tax (VAT). The situation is bad because we don't have enough information about what makes people follow VAT rules and what makes them not follow the rules. We also don't have a single model that can explain this problem. Therefore, this study expanded Fischer's model of people following tax laws to include the influences of knowing about taxes and the quality of tax services on following VAT rules in the retail industry of Jordan. This study suggested a model that represents the social, mental, and financial aspects to understand the payment behavior in the Jordanian retail industry.