5. 2018

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Browsing 5. 2018 by Author "Gakonyo, Alex Ngumi"

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    Factors Influencing Smuggling of Imported Goods at the Port of Mombasa
    (KESRA/JKUAT - Unpublished research project, 2018-10) Gakonyo, Alex Ngumi
    Smuggling is the secret movement of goods across national borders to avoid customs duties or import or export restrictions. It typically occurs when either the customs duties are high enough to allow a smuggler to make a large profit on the clandestine goods or when there is a strong demand for prohibited goods, such as narcotics or weapons. Most government and non-governmental agencies are continuously looking for ways in which they can bring down the rates of smuggling so that they may be able to concentrate more on their core work of protecting the society. The study was conducted at Kenya Revenue Authority at Mombasa. The researcher’s objectives were to explore the influence of smuggling of imported goods at the port of Kilindini in the last 5 years, to examine the influence of trade restrictions on smuggling of imported goods at the port of Kilindini in the last 5 years, to establish the influence of Sanctions by customs commissioner on smuggling of imported goods at the port of Kilindini in the last 5 years and to determine the influence of customs controls on smuggling of imported goods at the port of Kilindini in the last 5 years. From analysis, the findings showed that all factors ‘Rates of duties’, ‘Trade Restrictions’, and ‘Sanctions’ could be used to reduce rates smuggling of imported goods at the port of Kilindini. The most significant one and influential as regards to factors influencing smuggling of goods at the port of Mombasa was Sanctions with a significant correlation of 0.829, followed by Import Duty with a correlation of 0.811 and finally Trade Restrictions with a correlation of 0.602. The same trend was depicted in regression analysis. Therefore, based on these findings, government or organizations that intend to reduce or completely put an end to smuggling of goods at the port of Mombasa can implement some or all of the recommendations in this study such as, The company should be able to put all containers through the scanners, government should try and reduce import duty rates slightly and the courts should try borrowing from other countries that have less smuggling cases do in terms of Sanctions. The study used a descriptive research design and stratified random sampling method which picked a sample of 69 respondents from a population of 230 staff from Kenya Revenue Authority of various departments who were provided with questionnaires. In collecting the data, open-ended and closed-ended questions were used. The quantitative data was generated and analyzed by use of tables, charts and percentages. A pilot study was also conducted to pre-test or try out research instruments whether it was used properly to obtain consistency in information collected. It was concluded that the rates of duties should be re looked since the ones present are enticing the smugglers too much so that they may circumvent paying the duty rates and by doing so the government will not benefit. Simplifying the import duty rate structure will help reduce opportunities for tax avoidance as well as monitoring costs per unit of revenue raised since high import duty rates provide financial incentives for smuggling to take place, government should negotiate on porous borders dispute through table talks with neighbor countries, there should be established international conventions and there smart technology should be deployed so as to monitor goods that have a restriction from entering back in the country once they are deemed for export and that the company should be able to put up systems that will ensure the lead time will be reduced such as the electronic data interchange that electronically monitors stock levels of customers and they will be able to replenish the stock before there are stock outs. Also a Just in Time system should be adopted since this will enable reduction of lead times by just delivering products when they are just about to end.