1 Introduction

The tax filing process has come a long ways from the paper based systems used for decades [1]. Now tax filing is a global endeavor and involves a major commitment by the firm to meet compliance regulations [2]. Yet all might not be ideal under the surface as different cultures approach the mandatory filing process differently [3]. Intuit, for example provides a comprehensive tax service for business users that completely utilizes the cloud for its data exchange [4]. The way companies in different countries approach tax filing is not consistent and has been shown to be influenced by national culture and perceptions of institutional effectiveness [5].

As corporations operate they seek to adhere to accounting principles in the jurisdictions in which they operate. Since these can change from year to year it is important to have a trusted tax advisor and tax service you can rely on to provide advise on how the filing process works [6]. As the firm relies on this service they decide when they should continue to use the service or not. Moreover, certain cultures with different perceptions of perfect service should respond to the service encounter differently [7]. The tax form is also at the root of the assessment as it should be designed to be appealing to the user and not get them to turn off the tax paying processes, even when cultural differences are present [8]. As a result, this study seeks to understand how loyalty and commitment to the tax filing firm is formed. In order to explore the behavioral perspective of attitude and continuance, the variables of filing competence, tax form assessment, and satisfaction are proposed as antecedents of the tax filing behavior.

2 Tax Filing and Expectation-Confirmation Theory (ECT)

Today many tax preparation companies provide tax services for firms to submit their forms and be paid in short order [9]. Given the mandatory nature of tax filing the use of these third parties being given sensitive information should not be overlooked. By requiring this annual activity, the government is in effect encouraging a significant risk taking behavior by firms [10]. However, this is a better alternative than not using a service as the firm can then focus on their own core competencies and competitive advantages. This mandatory task might also not be something that is done poorly or perceived poorly, this might be due to the tax professional’s knowledge taking precedent over their ability to provide service [11].

One of the ways to reduce the risk is to ensure that the accountants providing the service are competent and exhibit the right skills to their service recipients [12]. This perception of the service being provided impacts the continuance intention of using the service in the future [13, 14]. This proposed study employs this concept through the lens of the expectation-confirmation theory.

The Expectation-Confirmation Theory (ECT) describes how preconditions to a stimulus are used to measure a pre and post social perception or attitude [15]. The ECT comprises four primary constructs or ideals: expectations, perceived performance, confirmation, and satisfaction [16]. The ECT posits that an individual’s expectations and perceived performance affect positive or negative disconfirmation after an event takes place (like tax filing). If a service beats expectations (positive disconfirmation) post-procurement satisfaction will be increased. If a service fails to meet initial expectations (negative disconfirmation), the firm filing the tax forms through the service is likely to be dissatisfied. Individuals who had a positive experience will be likely to repurchase a product or service, while, at the same time, an individual who is dissatisfied would be less likely to buy the service again [17, 18]. IS researchers have applied the theory to explain information technology usage [19, 20] and web consumer satisfaction [21]. In the context of this study the theory will be applied to a mandatory process required by a firm: annual tax filing.

3 Proposed Model of Continuance Intention

Figure 1 below examines tax filing in two different contexts, one in the US and one in China for SMEs. In this study the difference between the two samples is expected to moderate the perceptions of each relationship between the constructs. The factors driving continuance intention are explored in this unique setting.

Fig. 1.
figure 1

Proposed model of continuance intention of tax filling

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3.1 Service Provider Filing Competence

Service provider tax filing competence is seen as a sense of the firm’s perception of the overall service being provided by the tax preparation professionals [22]. The needs of those firms searching for the tax filing service stem from the lacking of professional knowledge on the task filing task. With this sense of competence being formed a firm is then in a position to rely on the service provider to fulfill these needs by properly filling out the required tax forms. When a firm has a high sense of competence then they can feel confident the tax filing process is going to be done correctly and efficiently. Higher filing competence will increase the client firm’s confidence on the problem solving and enhance the overall satisfaction about the service [23]. This also reduces their risk assessment of the relationship and increases the chance of the firm continuing to use the service.

Culture plays an important part in this assessment process when the tax filing work is done and needs to be double checked. Culture factors assert their different effects on the professional financial service in several aspects, including the institutional-level cultural difference, organization-level cultural difference and individual-level cultural difference [24]. All of these cultural differences will result in the gap from high satisfactory to merely decent work, or even complaints on the tax filing service. Cultural gap will be particularly prominent between the western developed countries and those eastern developing countries as the economic disparities will further widen cultural differences [25]. In some western developed countries, such as the United States, tax filing services have been provided in a more mature way and the organizational culture has been formed that the customers will appreciate those services provided by the professional service. On the other hand, the situations in some eastern developing countries, such as China, are more likely to get worse assessments over the tax filing service they receive as the organizational culture has not yet yielded a comprehensive evaluation process [26]. In this sense the assessment of the service being provided by a firm in a developed country is seen as being less of an influence relative to a developing country.

Thus, this leads to the following hypothesis:

  • H1: Filing competence positively influences confirmation of tax filing being done for the firm.

  • H1a. The effect of filing competence on confirmation is moderated by culture, and stronger organizational culture will result in greater positive confirmation.

3.2 Tax Form Assessment

Navigating the tax forms is seen as a task of some complexity. This is especially true in the context of international tax filing [27], as the unfamiliarity of the foreign tax policies and regulations raise the risk of making mistakes. One major difference in this task is the mandatory nature of annual tax filing and the need to be in compliance. To conclude, tax filing work may differ in various aspects from nation to nation, and the tax form assessments provide ways to investigate if the tax filing work was completed correctly as well as efficiently [28]. It is expected that professional service providers are more likely to get better feedbacks from their customers.

It is also suggested that culture may influence the outcome of the tax form assessment. Enterprise customers in the context of stronger organizational cultures will have a much lower burden of tax filing considering the expected difference by location and purpose [29]. On the other hand, companies in stronger institutional culture contexts who receive competent tax professionals working on the forms will get a better experience from the assessment and assurance that the forms have been completed correctly. Thus, this leads to the following hypothesis:

  • H2: A positive assessment of the tax forms positively influences confirmation of tax filing being done for the firm.

  • H2a. The effect of tax form assessment on confirmation is moderated by culture, and stronger organizational culture will result in greater positive tax form assessment.

3.3 Confirmation of Service Provided

Confirmation is defined as the firm’s awareness of the comparison between the expectations of the tax service used and the perceived tax filing outcomes [30]. The difference between the firm’s preliminary expectations of the tax filing service and the outcome of the tax filing service is captured in the confirmation construct. It can also be viewed as a deviation from the initial anticipations of the event being done [15]. It is expected that this deviation will get larger when the customer’s anticipation is low while the service satisfactory is high, and get smaller when the anticipation is high while the satisfactory is low. The outcome will be getting more complicated when these two variables change in the similar direction.

Differences in organizational and national culture are expected to result a higher confirmation on the tax filing being done correctly. In this sense a firm in a developed country should recognize the tax service being completed in compliance with local standards and receive a better experience on the service confirmation [31]. However, it might be possible for a corporation in a developing country finds the event to be done perfectly whereas they might not have high confirmation on the service being provided. Thus, this leads to the following hypothesis:

  • H3: Confirmation of service provided positively influences satisfaction of the tax filing service.

  • H3a: The effect of confirmation of service on satisfaction is moderated by culture, and stronger Organizational culture will result in greater positive service confirmation.

Confirming the expectations of the tax service provided proposes that firms are able to understand the potential benefits of filing taxes successfully. This might include getting a bigger refund or finding out about deductions that the firm was not aware of in the past. This validation of the confirming belief would increase attitude change towards the service performed. Firms who strongly confirmed the tax filing outcome assessment would have a more positive post-attitude than a pre-attitude assessment of the tax filing service [32]. Alternatively, those firms who did not experience what they expected would be likely to have a negative attitude towards the tax filing service, and this performance evaluation will have a more negative impact on the company’s attitude towards tax filing in the future and further affect the change of its financial management decision-making behavior.

This sense of the service being provided is expected to differ under different cultural contexts. In China where the culture is more collectivist [33] the assessment of confirmation is seen as smaller due to the culture when high expectations on the tax filing service already received. While firms in the United States, where the culture values the strength of the individual, this gap is seen to be much wider. Thus, this leads to the following hypothesis:

  • H4: Confirmation of service provided positively influences changed attitude of the tax filing service.

  • H4a: The effect of confirmation of service on changed attitude is moderated by culture, and stronger individual culture will result in greater positive service confirmation.

3.4 Satisfaction with Service Provided

Satisfaction is defined as an individual’s affective feelings about the tax service achieved through the tax filing process [19]. In the context of IT usage and service encounters multiple studies have found a significant link between the association of satisfaction and attitude towards service provisioning [34]. Thus, a firm’s high satisfaction of a tax filing service would result in increased feelings toward that service. Some research has also argued that the evaluation against the service expectation will increase the positive attitude towards the service provider via the satisfaction of the service. In other words, completing tax filing in a high quality will not directly increase the management attitude unless this fulfillment comes to the satisfaction on the firms performance in the past. Nonetheless, satisfaction with the tax filing service plays a core role in the management attitude towards the service and also its provider.

Again, these perceptions of service satisfaction are expected to differ by culture [35]. First, organizational culture affects the evaluation on the job of tax filing being done correctly by a tax service provider. Stronger organizational culture as is the more common in developed countries will make the evaluation process under a more formal way and yield a more positive attitude towards the service provider. Besides, we should take the manager’s own decision process into consideration as well because in many cases the manager’s individual cultural difference will impact their attitude on similar tax service providers jobs. Thus, this leads to the following hypothesis:

  • H5: Satisfaction of the service provided positively influences changed attitude toward the tax filing service.

  • H5a: The effect of satisfaction of service on changed attitude is moderated by culture, and stronger organizational and individual culture will result in greater positive changed attitude.

3.5 Attitude Change and Continuance Intention

Changed attitude refers to individual firm’s altered (increased or decreased) assessment from the experience of the tax filing service being completed [36]. The purpose of the tax filing process is to ensure the company is in compliance with current tax practices and does not violate any requirements in the jurisdictions they operate. These individual firms engaging the tax filing service with the third party would have a positive attitude on use when this is done flawlessly. On the other hand, continuance intention refers to the willingness to continue to use the previous tax filing service provider. Attitude change will determine the continuance intention in two different ways, including the positive performance of past tax service received, as well as the professional and stability of future tax service offerings [37]. This positive appraisal of the tax service provider will induce the firm to continue to use the service in the future.

Attitude change by a firm is not automatically formed [38], nor is the attitude change guaranteed to lead to a behavior modification by a firm [39]. Different cultures are expected to have significant influence on their attitude towards the continuance of the tax service provider. Considering in the stronger organizational cultural context, attitude change will be linked with the future selection of the tax service provider as the management decision is based on an objective assessment of the company’s past tax management performance. Lower organizational culture will involve more complex factors into the decision process and the former tax provider would be substituted by a new tax provider even if its previous work turned out to be satisfying. In addition, the individual culture will also influence the final decision on whether to continue to use the previous tax service or not, and managers who hold stronger individual cultures tend to increase the probability of the continuance intention. Thus, this leads to the following hypothesis:

  • H6: Changed attitude toward the tax filing service positively influences intention to continue to use the tax service.

  • H6a: The effect of changed attitude on continuance intention is moderated by culture, and stronger organizational and individual culture will result in greater positive continuance intention.

4 Method (Proposed)

A survey will be used to evaluate tax filing perceptions of firms located in two countries; China and the United States. The proposed methodology is similar to other studies looking at national culture and mandatory tasks [8, 40]. The test of the proposed relationships would be done through a transversal, cross cultural quantitative study. An equal number of questionnaires would be distributed to both a US and a Chinese audience, where the focus would be on SME institutions. Qualified subjects would be the primary tax filer for both the US and Chinese SMEs. The questions will be focused on the last year of tax collection and filing for revenue earned in the last year.

Established scales for the constructs would be found in existing literature and translated into the native language where the survey will be administered. The model would be tested using SEM as the data analysis choice. To test the impact of national culture a multi-group analysis will be conducted to identify the moderating effect of national culture in this setting. Data will be analyzed using PLS-SEM as this method allows for group nesting of comparisons and for formative and reflective indicators.

5 Expected Contribution and Discussion

This study has the potential to validate how two different cultures view tax filing and the forms that make up the process in two countries. It is possible that no discernable differences will be detected in the study. In this sense the samples might find the mandatory process to both be counter intuitive. Understanding how businesses approach the problem of tax filing and antecedents of their attitude reinforcement will assist government agencies with making changes in the future [41].

A future study might look at how to design a tax form to make it more appealing. Moreover, a form might be designed to be the same for both counties and look at a common set of accounting principles. Another study might also look at how willing either country might be to share data with outside third parties. Popular press has a number of stories of data breaches and how they affect a company’s operation [14].