In Malaysia was introducing the SAS stage by stage started from individual taxpayer commencing from the year of assessment 2004. Under the SAS, one of the objectives of the Inland Revenue Board (IRB) is, as far as possible to achieve voluntary compliance by the majority of the taxpayer. In fact, it was found that taxpayer agreed on the need to voluntary comply and disclosure their income. Although, it was found that there was a strong positive co-relationship between tax knowledge and the level of tax compliance. However a study by Mottiakavandar et al covering taxpayers in the northern of Peninsular Malaysia revealed that the level of tax knowledge had no effect on their non-compliance behavior. Instead, Mottiakavandar at al found positive co-relationship between attitudes towards one’s own compliance with attitudes towards other taxpayer’s compliance, effective of the IRB and fairness of the tax system.
Most extensive research in service quality has identified five broad dimension of criteria that normally used by consumers in evaluating service quality which are tangibles (appearance of physical elements), reliability (dependable, accurate performance), responsiveness (promptness and helpfulness), assurance (competence, courtesy, credibility, and security) and empathy (easy access, good communication and customer understanding). The importance of these criteria might be different based on the perception of consumers. However, in a study by Witkowski and Wolfinbarger towards customers in two countries, which are German and America, they find that customers in both countries rated reliability as the most important criteria to determine service quality (27%). This is followed by empathy (21%), responsiveness (19%), assurance (18%), and tangibles (16%).
In taxation, satisfaction towards service quality provided is also one of the criteria that will influence the taxpayers’ level of compliance. In a cross country study by Richardson (which involve 45 countries all over the world), he finds that satisfaction towards the fairness of the tax law have a significant negative relationship with tax evasion. It shows that taxpayers will less involve in tax evasion if they believed that the tax system is fair. This finding is consistent with Belkaoui who find that satisfaction on the effectiveness of the law has significant positive relationship with level of compliance, which shows that taxpayers are more willing to comply with the tax law if they satisfied with its effectiveness.
Closer to home, In a study by Junainah towards the implementation of SAS among individual taxpayers in Kota Kinabalu, Malaysia, she found that most of the taxpayers unwilling to participate in SAS because of the burden that they have to face, especially in terms of filling up tax return and calculating income tax payable. In other word, the respondents are not satisfied with the simplicity of the tax system. In a different study on taxpayers’ satisfaction, Tambi et. al has conducted a survey on service quality at Inland Revenue Board (IRB) of Ipoh Branch Office. In their study, they determine the customer satisfaction, service quality and the efficiency of the queuing system implemented at the service counters of the IRB branch. In the field survey towards 100 taxpayers, the results reveal that most of the respondents are not satisfied with the services provided. Among others, they are not satisfied with the long queues, time consuming services, unavailability of servers for online transaction, lack of courtesy from the staff, and problems arise due to equipment breakdown.