The Effect of Tax Rate on Taxpayers' Voluntary Compliance in Tanzania

Chindengwike, James; Kira, Alex Reuben

doi:10.13189/ujaf.2022.100501

Cited by 13 publications

(6 citation statements)

References 12 publications

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“…The findings revealed that tax rate has negative influence on tax compliance where by the less the tax rate imposed will influence SMEs to tax compliance and also imposing high tax rate to the SMEs will contribute to non-tax compliance in Iringa Municipality where the findings are supported by Chindengwike and Kira (2022) who examined the effect of tax rate on taxpayers' voluntary compliance in Tanzania, where finding shows that there is a negative effect of the tax rate on taxpayers' voluntary compliance. Again, the study indicates that the presence of good tax rates improves taxpayers' voluntary compliance and the tax rates influence taxpayers' voluntary compliance.…”

Section: Contribution Of Tax Rate To Tax Compliance Among Smes In Iri...mentioning

confidence: 84%

Factors Contributing to Tax Compliance among Small and Medium Sized Enterprises: A Case of Selected SMEs in Iringa Municipality

Abjadi,

Wiketye,

Mpogole

2023

Int. j. financ. account.

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The purpose of the study was to determine factors contributing to tax compliances among small and medium sized enterprises (SMEs) in Tanzania, with reference to selected SMEs in Iringa Municipality. The study objectives were; to evaluate the contribution of taxpayer’s education, to determine the contribution of tax rate and to assess the contribution of tax penalties on tax compliance among SMEs in Iringa Municipality. The targeted population were 172 SMEs where a sample size of 63 SMEs was drawn using descriptive research design. The study used stratified sampling technique and data were analysed using linear regression through ordinary least squares estimator showing relationship between tax compliance among SMEs as dependent variable to taxpayer education, tax rate and tax penalties as independent variables. Taxpayer education and tax penalties had a positive relationship and tax rate showed the negative relationship with tax compliance among SMEs. The results from the regression and t- test showed that taxpayer education, tax rate and tax penalties have a significant impact on tax compliance since the p-values were less than 0.05. In the case of the normal regression output the adjusted R2 equals 0.534 implying that the model explains about 53.4% variations in tax compliance among SMEs. The study concludes that tax payers’ education has positive effects on tax compliance while high tax rates discourage the SMEs on tax compliance. Nonetheless, high tax penalties positively influence tax compliance.. The study recommends fair and at moderate level tax levels and there should be more emphasis on tax payers’ education and awareness to increase tax compliance

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Section: Contribution Of Tax Rate To Tax Compliance Among Smes In Iri...mentioning

confidence: 84%

Factors Contributing to Tax Compliance among Small and Medium Sized Enterprises: A Case of Selected SMEs in Iringa Municipality

Abjadi,

Wiketye,

Mpogole

2023

Int. j. financ. account.

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“…Incentives are given to citizens who comply with tax obligations as appreciation and encouragement. According to Chindengwike & Kira (2022), tax rates affect attendance levels. A higher public willingness to pay taxes leads to a better tax ratio (Chindengwike & Kira, 2022).…”

Section: Tax Administration Reformmentioning

confidence: 99%

“…According to Chindengwike & Kira (2022), tax rates affect attendance levels. A higher public willingness to pay taxes leads to a better tax ratio (Chindengwike & Kira, 2022).…”

Section: Tax Administration Reformmentioning

confidence: 99%

Measuring the urgency of tax administration reform in Indonesia

Purba,

Salomo

2024

irjmis

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This research aims to explore the latest developments in taxation and describe why Indonesia must implement tax reform. The primary focus is on the state revenue generated by the tax sector over the last ten years, tax ratios, and the extent of the state's losses due to tax abuse in Southeast Asia. The research uses a constructive philosophy and paradigm with a qualitative approach. It employs explanatory research, with library research as a data collection technique. The findings indicate that significant measures are required to reform Indonesia's tax administration to increase state revenues from taxes, raise the tax ratio, and reduce the amount of state losses due to tax abuse. The complex tax administration system leads to tax avoidance and abuse, reducing the state's revenue and causing the tax ratio to be low. The government needs to organize the workings of the tax system using the principles of equality, simplicity, and justice. The research results are addressed to the government as regulators and policymakers, as well as to taxpayers and the public as policy implementers. Taxpayers and the public can comply with their tax obligations without hesitation because the tax system is strong, credible, and accountable.

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“…However, the study by Bernard et al, (2019), focused on costs and its implication on tax compliance and failed to link tax code complexity to tax compliance as is the case in the current study. Chindengwike and Kira (2022) researched on the effect of tax rate on taxpayers' voluntary compliance in Tanzania. A cross-sectional survey research design technique was used.…”

Section: Tax Filing Procedures and Tax Compliancementioning

confidence: 99%

Tax Compliance Procedures and Tax Compliance of Small and Medium Enterprises in Thika Town, Kiambu County, Kenya

Kamau,

Wanjohi

2024

jbmed

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Small and medium-sized enterprises are an important part of the taxpayer population in any country around the globe. Their taxation usually poses a number of challenges. They are numerous but contribute relatively little to the state coffers, while often absorbing a large share of scarce tax administration resources much needed elsewhere in administering the tax system. The purpose of the study is to investigate the effect of tax procedures complexity on tax compliance of Small and Medium Enterprises in Kiambu County. The theories guiding the study include the ability-to-pay taxation theory, Prospect theory of taxation, and the Allingham and Sandmo theory. This study adopted a cross-sectional survey design because the design is best suited for finding out the prevalence of a phenomenon, situation, problem, attitude or issue, by taking a cross-section of the population as it stands at the time of the study. The target population comprised of 3616 registered businesses in Kiambu County. A sample of 385 SMEs managers and owners were selected using stratified random sampling method. Primary data was collected with structured questionnaires. Secondary data was collected by use of secondary data collection sheet to supplement the primary data. A pilot study was undertaken on 38 SMEs to test the reliability and validity of the questionnaire. The tool of analysis that was used for this study was Statistical Package for Social Sciences version 28. Correlation and multiple linear regression analyses was used to determine the relationship between the tax code complexity and tax compliance among small and medium sized enterprises in Kiambu County. Before taking part in the study, top management of the SMEs were asked for their informed consent in order to ensure that the research is carried out in a suitable setting free from internal interferences and influences. The study findings established that tax filing procedure, tax registration, tax remittance and tax rate determination have significant effect on tax compliance of small and medium enterprises. It is concluded that the procedures for online tax filing provided by the tax agency are a bit complex to understand by small and medium enterprises. The study concludes that tax registration by small businesses is received positively and not misconstrued as been punitive. Further, the tax agency should roll out tax filing education programs to small traders to make it easy to file taxes and the tax filing period should be reviewed to be flexible. The tax collector should revise the current compulsory requirements to register for tax by SMEs as it was found to affect tax compliance.

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The Effect of Tax Rate on Taxpayers' Voluntary Compliance in Tanzania

Cited by 13 publications

References 12 publications

Factors Contributing to Tax Compliance among Small and Medium Sized Enterprises: A Case of Selected SMEs in Iringa Municipality

Factors Contributing to Tax Compliance among Small and Medium Sized Enterprises: A Case of Selected SMEs in Iringa Municipality

Measuring the urgency of tax administration reform in Indonesia

Tax Compliance Procedures and Tax Compliance of Small and Medium Enterprises in Thika Town, Kiambu County, Kenya

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