Abstract:
Considering Sri Lanka’s urgent imperative to strengthen tax compliance and broaden its
revenue base, this research aims to identify the key dimensions and determinants of youth tax
awareness that promote voluntary compliance and ensure long-term fiscal sustainability. The
study investigates tax awareness among the young in Sri Lanka through the development and
validation of a multidimensional assessment framework, grounded in exploratory and
confirmatory factor analysis, using a quantitative research approach. Drawing from a well
balanced and demographically representative sample of 1705, the study identifies six core
constructs Tax morale, Trust in government tax use, Procedural awareness, Legal awareness,
Tax compliance motivation, and Taxpayer rights as critical dimensions of youth tax
understanding. Findings reveal a pervasive lack of essential tax knowledge, particularly in
areas concerning legal obligations and taxpayer rights, despite a generally positive disposition
toward compliance. Procedural understanding showed moderate strength, yet widespread
informational deficiencies and reliance on third-party assistance persist. The validated
instrument demonstrates strong psychometric properties, offering a reliable and scalable tool
for future research, policy evaluation, and cross-contextual application. While some indicators
exhibited lower factor loadings, the overall model supports the conceptual integrity of the
constructs. The study calls for early, structured, and youth-centred tax education integrated into
formal curricula and supported by digital platforms and social media. Policy implications
emphasize transparency, institutional trust-building, and the creation of accessible, inclusive
communication and feedback channels. By addressing current gaps in legal literacy, procedural
clarity, and civic engagement, the findings provide a strategic foundation for designing
effective tax literacy programs and fostering a more informed and compliant generation of
taxpayers in Sri Lanka and comparable settings.
