Special Voluntary Disclosure Programme 2.0: Determinants of intention to participate among small and medium-sized enterprises in the northern region

Compliance with tax regulations among small and medium-sized enterprises (SMEs) in Malaysia has long been a challenge. It can be measured in terms of the low rate of submission of income tax return forms (ITRF). Although the Special Voluntary Disclosure Programme (SVDP) 1.0 was launched earlier, SMEs still struggle with complex tax issues, limited account resources and lack of awareness of regulatory requirements. This study aims to overcome this gap by investigating the factors that determine the intention of SMEs to participate in SVDP 2.0 by using the Theory of Planned Behavior (TBP) model. This study has two main objectives: (i) to determine the level of attitude, subjective norms, tax knowledge, penalty enforcement and intention to participate among SMEs owners in the Northern region in the SVDP; and (ii) to determine the relationship between the factors in (i). Quantitative methods were used to achieve this objective. An online questionnaire using the Google Form application was distributed to SME owners in Perlis, Kedah, Pulau Pinang and Perak via email. A total of 276 responses were collected and analyzed using SPSS software version 23. The results of the study revealed a strong tendency among SME owners in the northern region to participate in the SVDP in order to achieve tax compliance. This emphasizes the need for tailored policies and support mechanisms to improve engagement and compliance. This study contributes to the advancement of theory by addressing research gaps and suggesting practical initiatives. Implementing the proposed strategy can build a more supportive environment for SMEs to engage with the voluntary disclosure programme, which benefits businesses and the tax ecosystem by promoting compliance and stimulating economic growth.