Effect of Moral Obligation on Sales Tax Compliance among SME Taxpayers in Juba, South Sudan

Abstract

Tax compliance promotes social and economic growth by reducing the government's fiscal imbalance and debt while also providing funding for public services. Currently, the National Revenue Authority of South Sudan is focusing on maximizing tax revenue production from the country's huge number of small and medium enterprises, and this study contributes to that endeavour. The study's main goal was to examine the moral obligation, of sales tax compliance among SMEs. This study was guided by Tax Morale Theory. The study used an explanatory research design and the study's target population was 1,320 SMEs, with 307 SMEs in Rejaf Sub-County registered for sales tax. The data was examined using both descriptive and inferential statistics. The study found that there is a positive and significant effect of moral obligation on sales tax compliance (β₁ =0.241, p<0.05), The study recommends that South Sudan's Ministry of Finance and Economic Planning build a strong mechanism for monitoring and evaluating the efficiency of tax policy implementation. Furthermore, research should involve a more diversified set of SMEs to capture a greater variety of opinions, taking into account differences in size, industry, and ownership structure.