Assessing the diffusion of E-Filing for tax compliance among Small and Medium Enterprises (SMEs) in Malaysia

E-filing services were introduced by the Inland Revenue Board of Malaysia (IRBM), ushering in a new era of tax administration effectiveness as users gained the ability to submit their tax return forms electronically through internet-based platforms. Despite the availability of e-filing services since 2004, a noteworthy challenge persists as a substantial number of users, especially among Small and Medium-sized Enterprises (SMEs), continue to exhibit limited familiarity with the electronic filing system, highlighting the ongoing need for awareness and education on this digital tax compliance. The present study utilizes the Technology Acceptance Model (TAM) framework to evaluate the diffusion of e-filing for tax compliance among SMEs in the context of Malaysia, incorporating perceived ease of use, perceived usefulness, and digital tax compliance as key elements. Three hypotheses were tested in this study. Data were collected from 172 owner of SMEs on their perspectives (86% of response rate) related of willingness to utilise e-filing as a method of complying with focus in Selangor using an online survey. Statistical Package for Social Science (SPSS) were used to analyse the data. Overall, the findings underscored the pivotal role of user-friendly systems, perceived benefits, and digital transformation in promoting the adoption of digital tax compliance solutions among small firms in Malaysia, emphasizing the positive impact of digitalization on SMEs' intention to adopt e-filing while highlighting the need for improved user experience and interface design to further enhance willingness to embrace e-filing for tax compliance. IRBM is suggest enhancing the E-filing system with a dedicated SME site, immediate customer assistance, and a user-friendly mobile application is crucial for promoting widespread adoption and ensuring user-friendliness