When faith meets institutional failure: perceived corruption as a moral pathway to tax noncompliance in Indonesia

This study examines the interplay among religiosity, corruption perception, trust and tax evasion in Indonesia, seeking to explain inconsistent findings in prior literature regarding religiosity’s effects on compliance and to identify boundary conditions for trust-based voluntary compliance. Using a quantitative cross-sectional design, survey data were collected from 404 individual taxpayers in Indonesia and analysed through Partial Least Squares Structural Equation Modeling with bootstrapping procedures in SmartPLS 4. The findings reveal that corruption perception is the strongest predictor of tax evasion, while religiosity exerts no direct effect but operates through complete mediation: religious moral standards significantly amplify corruption perception, which subsequently elevates evasion behavior. Trust fails to moderate the corruption perception–tax evasion relationship, exposing the boundary conditions of the Slippery Slope Framework under endemic corruption. This study contributes by identifying a complete mediation mechanism that reconciles the bidirectional effects of religiosity documented in prior literature, while demonstrating trust’s insufficient protective capacity when corruption perceptions overwhelm normative commitments. The findings provide contextual evidence for Social Contract Theory and the Slippery Slope Framework by showing that corruption perception plays a central role in shaping taxpayers’ institutional evaluations and can diminish the effectiveness of trust as a driver of voluntary tax compliance.