The Influence of Tax Knowledge and Trust in Government on Taxpayer Compliance (A Case Study of Individual Taxpayers in Batam City)

Abstract

The tax sector is a key pillar of development financing and public services, although its effectiveness is still hampered by low individual taxpayer compliance. This quantitative study aims to analyze the impact of tax understanding and trust in the government on individual taxpayer compliance in Batam City. With a sample of 389 respondents engaged in economic activities in Batam, primary data were analyzed using validity, reliability, classical assumptions, and multiple linear regression tests using SPSS version 27. The results of the analysis indicate that tax knowledge and trust in the government, both partially and simultaneously, have a positive and significant effect on taxpayer compliance. The Adjusted R Square value of 0.422 indicates that these two variables explain 42.2% of the variation in compliance, while the remainder is influenced by external factors. This study concludes that strengthening tax education and government credibility effectively encourages voluntary compliance to optimize state revenue.