Contribution of Simplicity of Prepaid LUKU Meter Billing System on Property Tax Revenue Collection in Moshi Municipality, Tanzania

Abstract

The simplicity of electronic systems, including prepaid billing systems, has been said to simplify life for clients and service providers. The Tanzania Revenue Authority (TRA) collects property tax through the Lipa Umeme Kadili Utumiavyo (LUKU) prepaid electricity billing system. This study sought to establish the influence of the systems simplicity on property revenue collection by TRA in Moshi Municipality. A concurrent research design with a mixed research approach was employed. The study was informed by the ability to pay principal theory. The study population was 14,364 premises installed with LUKU meters in the study area. A sample size of 192, determined by Fisher (1991), was used. A questionnaire was used to collect primary. Secondary data was obtained using a documentary review guide to gather data from audited reports of TRA from the financial year 2018/2019 to 2022 Slash 2023 (5 years). Content validity was used to ensure the instruments validity, while reliability was ensured through testre test measures. A statistical package for social science (SPSS) was used as an aid for data analysis where the regression models were run. The study anticipated an observable relationship between the simplicity of the LUKU system and property tax collection (independent and dependent variables), respectively. The study established that the simplicity of the LUKU system contributes to property tax collection in the study area at p value Less Then 0.05. The study concluded that the simplicity of use of the LUKU prepaid billing system has increased property tax revenue collection for TRA. It is recommended that TANESCO convert more meters into prepaid, as it will enhance property tax revenue collection capabilities and, at the same time, reduce costs associated with collection.