Multiculturalism and tax compliance of business entrepreneurs

Abstract

Due to changes in immigration rules and globalisation, most developed countries including Australia, Canada, New Zealand, the United Kingdom and the United States of America are becoming more multi-cultural. The consequence of multiculturalism challenges the present assumption of culturally homogeneous resident taxpayers. With this, it warrants a re-examination of existing tax policies and tax administration which previously had not accounted for culturally diverse populations. With sparse research on tax compliance and multiculturalism, there is much to be gained from an in-depth qualitative study on actual ethnic taxpayers’ compliance behaviours. This study examines the tax compliance practices and perceptions and the cultural values of the four largest ethnic business groups in a developed nation, New Zealand, using Hofstede’s (1980, 2001) framework. It has been found that ethnic taxpayers do undertake varied tax compliance practices of which some have cultural underpinnings.