The Effect of Budget Management Efficiency and Tax Administration Digitalization on Tax Potential Mobilization Performance: The Mediating Role of Cost of Tax Collection

Tax revenue plays a vital role in supporting sustainable national development, making tax administration performance a strategic priority. This study examines the effects of Budget Management Efficiency and Tax Administration Digitalization on Tax Potential Mobilization Performance through the mediating role of Cost of Tax Collection. A quantitative approach was employed using secondary time-series data from the Directorate General of Taxes covering the period 2015–2025. Data were analyzed using multiple regression analysis, path analysis, and Sobel Test with EViews 13. The results indicate that Budget Management Efficiency and Tax Administration Digitalization do not directly affect Tax Potential Mobilization Performance. Cost of Tax Collection has a negative and significant effect on Tax Potential Mobilization Performance. Budget Management Efficiency significantly reduces Cost of Tax Collection, whereas Tax Administration Digitalization does not significantly affect it. Furthermore, Cost of Tax Collection significantly mediates the relationship between Budget Management Efficiency and Tax Potential Mobilization Performance but does not mediate the relationship between Tax Administration Digitalization and Tax Potential Mobilization Performance. The study concludes that Cost of Tax Collection serves as the primary mechanism linking organizational efficiency and tax revenue mobilization performance