Tax Invoices Not Based on Actual Transactions and Law Enforcement in Indonesia: A Literature Review

Abstract

Tax invoice fraud through fictitious transactions represents a persistent challenge to tax administration globally, yet systematic investigation of enforcement mechanisms in emerging economies remains limited. This systematic literature review examines the phenomenon of tax invoices not based on actual transactions (TINBAT) in Indonesia, analyzing 47 scholarly sources, regulatory documents, and enforcement reports published between 2018-2024.
Employing Agency Theory and Deterrence Theory as analytical frameworks, this study identifies a critical research gap: while existing literature extensively documents TINBAT typologies and detection methods in developed economies, empirical evidence regarding enforcement effectiveness and institutional coordination mechanisms in developing country contexts remains scarce. Our thematic analysis reveals three key findings: (1) technological advancement in invoice systems paradoxically creates both detection opportunities and sophisticated evasion methods, (2) inter-agency coordination suffers from institutional fragmentation despite formal cooperation frameworks, and (3) deterrent effects of sanctions are undermined by asymmetric information and capacity constraints.
This review contributes to tax compliance literature by proposing an integrated enforcement framework that synthesizes technological, institutional, and behavioral interventions. Policy implications suggest that effective TINBAT prevention requires not merely regulatory tightening, but fundamental redesign of information architecture, capacity-building initiatives targeting specialized competencies, and institutional mechanisms enabling real-time data sharing across enforcement agencies.