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How does digital technology application affect tax compliance?

Author

Listed:
  • Han, Liangliang
  • Wang, Yunqiao
  • Sun, Jiaqi
  • Sun, Zheyu

Abstract

This study investigates the impact of digital technology deployment on company tax compliance, using data from 2013 to 2023. Empirical findings indicate that digital tools enhance compliance by diminishing information asymmetry between corporations and tax authorities, increasing total factor productivity to align profitability with transparency, and fortifying internal governance through automated controls and real-time data synchronization. These technologies provide responsibility, discouraging tax evasion by increasing discovery risks and streamlining compliance procedures. The findings highlight digital transformation as a dual catalyst for operational efficiency and regulatory compliance, providing policymakers and enterprises to align technical innovation with financial accountability.

Suggested Citation

  • Han, Liangliang & Wang, Yunqiao & Sun, Jiaqi & Sun, Zheyu, 2025. "How does digital technology application affect tax compliance?," Finance Research Letters, Elsevier, vol. 85(PB).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pb:s1544612325011900
    DOI: 10.1016/j.frl.2025.107932
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    References listed on IDEAS

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