GST Practitioners’ Perception of the Complexity of GST Compliance Procedures and Their Satisfaction: A PLS-SEM and IPMA Approach

Abstract

Goods and Services Tax (GST) is one of the most significant tax reforms in India’s tax structure. The implementation of GST has restructured the indirect taxation system in India, aiming to simplify compliance with a unified tax structure. Despite such objectives, the GST regime in India continues to face challenges due to multiple tax slabs, technical snags in GST return filing systems, and ambiguous interpretations. After periodical GST council meetings, amendments will be made in the GST provisions and revisions of tax slabs. GST Taxpayers complying with the GST procedures is crucial for streamlining the taxation system. GST practitioners are representatives who help the GST taxpayers to achieve compliance and help to reduce the complexities. This micro-study seeks to analyze the relationship between GST Practitioners’ perception of the complexity of GST compliance procedures and their level of satisfaction with GST compliance procedures. In addition, it is important to identify the factors that are the strong drivers for the relationship. Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS 4 software was used to analyze the relationship and found an inverse relationship between complexity and satisfaction of GST compliance procedures from the perception of GST practitioners. Importance-Performance Map Analysis in SmartPLS 4 software was used to extend the results of PLS-SEM and found the strong drivers that influence the inverse relationship between complexity and satisfaction of GST compliance procedures namely monitoring of business turnover for threshold, managing timelines for returns, missing deadlines and losing credit, documentation procedures, and determining the application of reverse charge mechanism in a transaction. This micro-study offers insights to provide improvised digital infrastructure and automation to reduce the complexities and the importance of the Government guidance to remove ambiguity when there is an amendment in regulations implemented to ease the complexity of the compliance.