Iranian Journal of Accounting, Auditing and Finance

Iranian Journal of Accounting, Auditing and Finance

Ranking the Factors Affecting the Level of Tax Compliance within the Framework of Comprehensive Tax Plan

Document Type : Original Article

Authors
Rahman Sajadpour 1
Mehdi Arab Salehi 1
Iraj Kazemi 2
1 Department of Accounting, Faculty of Administrative Sciences and Economics, University of Isfahan, Isfahan, Iran
2 Department Of Statistics, Faculty Of Mathematics And Statistics, University of Isfahan, Isfahan, Iran
10.22067/ijaaf.2026.48222.1611
Abstract
According to this study, one of the most significant information technology projects of Iran's National Tax Administration (INTA) is the comprehensive tax plan, which considers the factors influencing tax compliance. In this research, the factors affecting tax compliance, including accounting variables (internal factors) and environmental conditions (external factors), were evaluated and ranked using decision tree algorithms. This study employed a longitudinal firm–year dataset (panel data) and analyzed it using machine-learning techniques rather than panel econometric models. The comparison of decision tree models revealed that the variables influencing tax compliance, in descending order of importance, were disclosure quality, board remuneration, the percentage of free-float shares, government ownership and influence in firms, cash-holding level, income smoothing, and firm size. The ranking of influential variables in this study provided valuable guidance for regulatory and supervisory institutions seeking to enhance tax compliance. Moreover, the findings indicated an evaluative indicator of the implementation level of the comprehensive tax plan, which can be used to assess the performance of the Iranian National Tax Administration and for future research.
Keywords
Disclosure Quality, Financial Reporting Transparency, Tax burden
Tax compliance, Tax Plan
Subjects
  1. Abdelfattah, T. and Aboud, A. (2020). Tax avoidance, corporate governance, and corporate social responsibility: The case of the Egyptian capital market. Journal of International Accounting, Auditing and Taxation, 38, A. 100304. https://doi.org/10.1016/j.intaccaudtax.2020.100304
  2. Alasfour, F., Samy, M. and Bampton, R. (2016). The determinants of tax morale and tax compliance: Evidence from Jordan. In Advances in Taxation, (pp. 125-171). Emerald Group Publishing Limited. https://doi.org/10.1108/S1058-749720160000023005
  3. Allingham, M. G. and Sandmo, A. (1972). Income tax evasion: A theoretical analysis. Journal of Public Economics, 1(3-4), pp. 323-338. https://doi.org/10.1016/0047-2727(72)90010-2
  4. Alm, J. and Torgler, B. (2011). Do ethics matter? Tax compliance and morality. Journal of Business Ethics, 101(4), pp. 635-651. https://doi.org/10.1007/s10551-011-0761-9
  5. Armstrong, C. S., Blouin, J. L., Jagolinzer, A. D. and Larcker, D. F. (2015). Corporate governance, incentives, and tax avoidance. Journal of Accounting and Economics, 60(1), pp. 1-17. https://doi.org/10.1016/j.jacceco.2015.02.003
  6. Balakrishnan, K., Blouin, J. L. and Guay, W. R. (2019). Tax aggressiveness and corporate transparency. The Accounting Review, 94(1), pp. 45-69. https://doi.org/10.2308/accr-52130
  7. Bani-Khalid, T., Alshira’h, A. F. and Alshirah, M. H. (2022). Determinants of tax compliance intention among Jordanian SMEs: A focus on the theory of planned behavior. Economies, 10(2), p. 30. https://doi.org/10.3390/economies10020030
  8. Bartha, A. and Boda, Z. (2024). Tax compliance motivations during corruption scandals in a fragile democracy: a before-and-after study. Europe-Asia Studies, 76(7), pp. 1055-1077. https://doi.org/10.1080/09668136.2024.2378814
  9. Block, J. (2016). Körperschaftsteuer und Unternehmensgründung. IZA World of Labor, Bonn, Germany, p. 257. https://doi.org/10.15185/izawol.257
  10. Brockmeyer, A., Estefan, A., Arras, K. R. and Serrato, J. C. S. (2021). Taxing property in developing countries: Theory and evidence from Mexico (No. w28637). National Bureau of Economic Research. Working Papers, United States. https://doi.org/10.3386/w28637
  11. De Neve, J. E., Imbert, C., Spinnewijn, J., Tsankova, T. and Luts, M. (2021). How to improve tax compliance? Evidence from population-wide experiments in Belgium. Journal of Political Economy, 129(5), pp. 1425-1463. https://doi.org/10.1086/713096
  12. Desai, M. A. and Dharmapala, D. (2006). Corporate tax avoidance and high-powered incentives. Journal of Financial Economics, 79(1), pp. 145-179. https://doi.org/10.1016/j.jfineco.2005.02.002
  13. Dikmen, S., Çiçek, H. G. and Kaya, I. (2025). How does Spiritual Well-Being and Religious attitude influence tax compliance? Evidence from Turkiye. Journal of Tax Reform, 11(2), pp. 417-433. https://doi.org/10.15826/jtr.2025.11.2.209
  14. Duhoon, A. and Singh, M. (2023). Corporate tax avoidance: a systematic literature review and future research directions. LBS Journal of Management & Research, 21(2), pp. 197-217. https://doi.org/10.1108/LBSJMR-12-2022-0082
  15. Dyreng, S. D., Hanlon, M. and Maydew, E. L. (2008). Long‐run corporate tax avoidance. The Accounting Review, 83(1), pp. 61-82. https://doi.org/10.2308/accr.2008.83.1.61
  16. Foley, C. F., Hartzell, J. C., Titman, S. and Twite, G. (2007). Why do firms hold so much cash? A tax-based explanation. Journal of Financial Economics, 86(3), pp. 579-607. https://doi.org/10.1016/j.jfineco.2006.11.006
  17. Gebrihet, H. G., Gebresilassie, Y. H. and Woldu, G. T. (2023). Trust, corruption, and tax compliance in fragile states: on a quest for transforming Africa into future global powerhouse. Social Sciences, 13(1), p. 3. https://doi.org/10.3390/socsci13010003
  18. Hesami, S., Jenkins, H. and Jenkins, G. P. (2024). Digital transformation of tax administration and compliance: A systematic literature review on E-Invoicing and prefilled returns. Digital Government: Research and Practice, 5(3), pp. 1-20. https://doi.org/10.1145/3643687
  19. Hsu, H. Y. (2024). Fiscal transparency and tax morale: Is the relationship shaped by perceptions of government performance and corruption?. International Review of Administrative Sciences, 90(3), pp. 563-580. https://doi.org/10.1177/00208523231220599
  20. International Monetary Fund (IMF). (2022). Evidence from VAT E-Invoicing Reform in Peru, IMF Working Paper, Washington, DC. https://doi.org/10.5089/9798400204876.001
  21. Kaghazloo, F. and Borrego, A. C. (2022). Designing a model of the factors affecting tax professionals' tax noncompliant behaviour using the ISM Approach. Public Organization Review, 22(4), pp. 1099-1120. https://doi.org/10.1007/s11115-021-00572-y
  22. Kerr, J. N., Price, R. and Román, F. J. (2016). The effect of corporate governance on tax avoidance. In Proceedings. Annual Conference on Taxation and Minutes of the Annual Meeting of the National Tax Association, National Tax Association, 109, pp. 1-50. https://dx.doi.org/10.2139/ssrn.3861965
  23. Kirchler, E., Hoelzl, E. and Wahl, I. (2008). Enforced versus voluntary tax compliance: The “slippery slope” framework. Journal of Economic Psychology, 29(2), pp. 210-225. https://doi.org/10.1016/j.joep.2007.05.004
  24. Koumpias, A. M., Leonardo, G. and Martinez-Vazquez, J. (2020). Trust in government institutions and tax morale. International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University. Working Paper, Atlanta, Georgia https://icepp.gsu.edu/files/2020/02/paper2001.pdf
  25. Mebratu, A. A. (2024). Theoretical foundations of voluntary tax compliance: evidence from a developing country. Humanities and Social Sciences Communications, 11(1), pp. 1-8. https://doi.org/10.1057/s41599-024-02903-y
  26. Mohammed, H. and Tangl, A. (2023). Taxation perspectives: Analyzing the factors behind viewing taxes as punishment—A comprehensive study of taxes as service or strain. Journal of Risk and Financial Management, 17(1), p. 5. https://doi.org/10.3390/jrfm17010005
  27. Nwokoye, E. S., Igbanugo, C. I., Ekesiobi, C. and Dimnwobi, S. K. (2023). Fiscal incentives and tax compliance behaviour in industrial clusters: a survey of clusters in South-east Nigeria. Journal of African Business, 24(1), pp. 147-166. https://doi.org/10.1080/15228916.2022.2031827
  28. Opler, T., Pinkowitz, L., Stulz, R. and Williamson, R. (2001). Corporate cash holdings. Journal of Applied Corporate Finance, 14(1), pp. 55-67. https://doi.org/10.1111/j.1745-6622.2001.tb00320.x
  29. Organisation for Economic Co-operation and Development (OECD). (2024). Tax Administration 2024: Insights from Digital Transformation, OECD Publishing, Paris. https://doi.org/10.1787/2d5fba9c-en
  30. Rwabunywenge, M., Nchimbi, M. and Suluo, S. (2024). The influence of provision of public services on tax compliance in SMEs: mediating role of tax morale. Business Management Review, 27(2), pp. 90-107. https://doi.org/10.56279/bmr.v27i2.6919
  31. Sano, H. (2025). Impacts of public disclosure on tax compliance using agent-based modeling: H. Sano. Journal of Economic Interaction and Coordination, 20(1), pp. 273-305. https://doi.org/10.1007/s11403-024-00420-4
  32. Slemrod, J. (2019). Tax compliance and enforcement. Journal of Economic Literature, 57(4), pp. 904-954. https://doi.org/10.1257/jel.20181437
  33. Sokolova, M. and Lapalme, G. (2009). A systematic analysis of performance measures for classification tasks. Information Processing & Management, 45(4), 427-437. https://doi.org/10.1016/j.ipm.2009.03.002
  34. Taing, H. B. and Chang, Y. (2021). Determinants of tax compliance intention: Focus on the theory of planned behavior. International Journal of Public Administration, 44(1), pp. 62-73. https://doi.org/10.1080/01900692.2020.1728313
  35. Torgler, B. (2007). Tax compliance and tax morale: A theoretical and empirical analysis. In Tax Compliance and Tax Morale. Edward Elgar Publishing, Massachusetts, USA.
  36. Zhang, L., Gu, Y., Yu, Y. and Pan, L. (2025). Mandatory industry disclosure and corporate tax avoidance: Evidence from Chinese listed firms. Economic Analysis and Policy, 109, A. 101469. https://doi.org/10.1016/j.eap.2025.12.008

 

Send comment about this article
Enter Name.
Enter a valid email address.
Enter a vaid affiliation.
Enter comments (At leaset 10 words)
CAPTCHA Image
Enter Security Code Correctly.