Tax Literacy and Financial Literacy among Taxpayers in Iraq: Determinants and Empirical Evidence

Abstract

This study examines the determinants of tax literacy among taxpayers in Iraq and investigates the relationship between tax literacy, financial literacy, and demographic characteristics. The study adopts a quantitative survey approach using a structured questionnaire distributed to 312 respondents. Tax literacy was measured through its cognitive, affective, and psychomotor dimensions. The findings reveal weaknesses in taxpayers’ knowledge and practical tax skills, particularly regarding tax regulations, tax procedures, and tax calculations. The results also indicate that many respondents perceive the tax system as unfair and tax legislation as complicated. Furthermore, the study found a significant positive relationship between financial literacy and tax literacy. Financial literacy emerged as the strongest determinant of tax literacy, followed by access to tax information, occupation, and income level.