Theoretical Review of tax compliance
Theory of Social Learning
According to the social learning hypothesis, learning new behaviors can come from both direct
experience and observation (Bandura, 1977). A cognitive process, social learning only occurs in
social contexts. The cycle of social learning includes the processes of attention, retention, motor
reproduction, and practice. Positive behaviors are routinely rewarded, whilst negative behaviors
are discouraged in order to stop undesirable behavior. This improves or encourages moral
behavior in the society (Bandura, 1977).
Jatmiko (2006) asserts that the social learning theory is important in highlighting how taxpayers
behave in terms of abiding by tax laws. The previous standard that does not result in punishment
is often followed by taxpaying citizens. When taxpayers' perspective toward the government is
improved, they are more willing to pay their tax obligations. When people learn that the taxes
they pay go toward funding public goods, their motivation to follow tax laws is increased. When
a taxpayer has previously received a fine or has seen another taxpayer receive a fine, they are
more likely to follow the tax laws in order to avoid receiving one themselves. This encourages
people to pay attention to the finer points of the entire taxation structure in their jurisdiction.
The purpose of this study was to determine whether social-economic factors, such as individual
taxpayer characteristics, tax knowledge, and tax complexity, have an impact on individual
taxpayer compliance in Kenya. This study aimed to determine if tax fines in Kenya actually
affect the relationship between social and economic characteristics and individual taxpayers' tax
compliance. The goal of this investigation was based on this contemporary theory.
Economics of Dissuasion
