Abstract

Tax procedures have increased due to the expansion of international trade opportunities, administrative strategies and technology. As a result, tax complexity increases and burdens citizens, enterprises and tax authorities. Traditional causes of complexity are found in political instability, legislation, central and operational planning. The interpretation of legislation greatly affects tax awareness; thus, information systems aimed at tax system modernizations and upgrades, according to international practices. Questionnaires were sent to tax payers and tax authorities investigating their perception of complexity. Through factor analysis, the items generated factors that simplify or complicate a tax system. Some of the traditional factors of complexity such as administration and information systems were expected. However, governmental influence and tax awareness were significantly reduced when dealing with taxation as a system. On the other hand tax reforms simplified the tax system, while tax awareness due to technology has little influence on complexity. This swift of some traditional governmental and citizens’ oriented factors denotes the necessity of simplifying and reforming procedures in favor of demands in technology and tax standardization in a smaller country’s tax system.

Key words: Taxation, tax complexity, tax systems, information systems, systemic complexity, tax simplifications.