The expectations gap between Maltese SME taxpayers and tax practitioners

Abstract

Purpose: This study reviews the instances where expectation gaps occur in relation to tax services, i.e. expectation gaps between taxpayers and tax practitioners. This is possible by gaining an understanding of how local SME taxpayers form expectations vis-à-vis what type of service tax practitioners are willing and able to provide. The study also focuses on the ways and means of mitigating expectation gaps. Design: The objectives of the study were met through various semi-structured interviews with selected local tax practitioners, and selected Maltese SME taxpayers. Findings: Findings suggest that an expectation gaps occur due to various reasons. Different taxpayers have different expectations and different tax practitioners provide a different type of service. The most effective means of closing the expectations gap was found to be the establishment of a strong relationship. In doing such, there is no one-size-fits-all method as different taxpayers have differing characteristics and needs. Thus, each case must be treated individually. Conclusion: This study concludes that the way forward would be for tax practitioners to invest more time in building a strong relationship with their clients and also to allow them to understand the importance of building such relationships. Tax practitioners should also give more value and thought to other means of mitigating the expectations gap such as the proper use of engagement letters. Value: Given that the topic has hardly been studied in the local context, this research has sought to occupy this lacuna in the literature. This study also gives the opportunity to both taxpayers and tax practitioners to better understand each other. Tax practitioners would better understand the expectations formed by taxpayers, while taxpayers could get a better understanding of the type of service tax practitioners are willing and able to provide. Both parties also benefit from this study by learning new ways of narrowing expectation gaps.