What role does trust play in adoption of online Good Service Tax Filing in India?

The initial adoption of Goods and Service Tax Network (GSTN) is one of the essential driving forces to influence the success of Goods and Service Tax (GST) in India.

The diffusion of any technology (in this case, GSTN) is affected by many variables, such as individual characteristics, organizational members, and social system. The theory of planned behaviour (TPB) and technology acceptance model (TAM) are widely used by researchers to understand the impact of these variables on behavioural intention. 

Thus, keeping in view the turbulence caused by GST, the present article tried to analyse the intention of business persons to use the GSTN by integrating TAM and TPB. The authors draw upon the literature to develop a structured questionnaire on the adoption of technology. Data has been collected from 204 small- and medium-sized business owners that have a GSTN number. 

Methodologically, structure equation modelling has been used to test the significance of the relationship among variables under study. 

Data analysis showed that many small business owners were facing technical issues at the time of filing GST. 


Results indicated that trust was one of the critical variables affecting the use of GSTN by business persons in India. 

However, perceived usefulness, subjective norms, and perceived behavioural control were found to have a significant influence on attitude towards GSTN that in turn affected the intention to use GSTN by the business person. 

How does this study help?

The study presents steps for the government to improve the acceptability and understanding of the GSTN among small- and medium-sized business organizations for better compliance of the new tax regime. The study contributes to existing literature by testing the role of trust in facilitating the acceptance of an IT-based tax filing system (GSTN). In a developing country like India, where computer literacy is low, making such technology mandatory raises many challenges. The study provides insights in addressing challenges related to acceptance of GSTN by small- and medium-sized business organizations.

Goods and Service Tax (GST) regime —

The Goods and Service Tax (GST) regime was implemented on 1 July 2017, as an indirect taxation system in India (Press information Bureau, 2018). It is a destination-based value-added tax (VAT) system. For filing GST, there is an online interface called the GST Network (GSTN) provided by the government in collaboration with the private sector. It is maintained by a non-profit company, in which non-government financial institutions hold a 51 per cent share (Goods and Service Tax Network, 2019). 

As per the GSTN company website, rupees 100 million is the authorized capital for providing IT infrastructure to the GST regime. The shift from a manual to an online tax filing system (GSTN) has brought many challenges, especially to small- and medium-sized business organizations (Fintrakk, 2017). For private organizations, providing services online is an augmented part of the delivery to attract and retain maximum customers with an objective of earning more profit. Whereas in the case of the government, the primary objective of promoting and implementing a new system or technology is to make government services convenient to citizens (Wu & Chen, 2005). 

Thus, government e-services are different from services offered by a company as the acceptance of the new technology depends on many extraneous factors (mandatory use, voluntary use, and imposition). Under the new tax system in India, filing tax online through the GSTN is mandatory. The Indian government is aggressively encouraging business organizations to use the GSTN for declaring and filing their tax. 

However, adoption and understanding of the system is still low among its end users, that is, business persons. Business organizations, especially small- and medium-sized organizations are facing challenges in filing their tax online regardless of the promotional and educational efforts made by the government. Owing to this, they need to hire professional accountants for filing the tax, which, to an extent, defeats the purpose of the GST regime.

—Taken from Role of Trust in Adoption of Online Good Service Tax Filing in India in Vikalpa: The Journal for Decision Makers.

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