Effect of Tax Dispute Resolution on Tax Administration in Kenya Revenue Authority Malindi Town
Date
2020
Authors
Tsumah, Naomi Mbeyu ; Mumia Benn MINCU, CPA.K
Journal Title
Journal ISSN
Volume Title
Publisher
KESRA/JKUAT - Unpublished research project
Abstract
According to most scholars, the prevailing tax disputes systems does not meet all the principles of Dispute System Design, including the most critical one of reconciling parties’ interest thus resulting to higher transaction costs, frequent recurrence of tax disputes and greater dissatisfaction with outcomes. It was in the backdrop of this problem, that the researcher sought to establish the effect of tax dispute resolution on tax administration in KRA Malindi. The study was guided by the following objectives: To examine the effect of internal tax review on the tax administration in KRA Malindi, to determine the effect of tax appeal tribunals on the tax administration in KRA Malindi and to establish the effect of alternative dispute resolution on the tax administration in KRA Malindi. The study was conducted in Malindi TSO as per the three objectives. To provide the basis of the study assumptions, the study relied on the following theories: social interest theory, theory of pain and pleasure and conflict management model. The study adopted cross- sectional survey design using both quantitative and qualitative approaches, where 63 employees from various departments in the KRA office were targeted, a sample of 55 employees was used as the study and the sample size was determined using Slovin’s formula. Sampling technique adopted is simple random technique. Data was collected using both primary and secondary data. For primary data, open ended and close ended questionnaires were used and secondary data was collected from libraries, internet and research from other scholars. The study used SPSS for data analysis, where inferential and descriptive statistics were conducted. The researcher distributed 55 questionnaires but only 43 questionnaires were returned, this represented a response rate of 78.18%. The analysis showed that relationship between internal tax review and tax administration, it was determined that (β=0.069; p=0.241). In addition, on the relationship between tax appeal tribunal and tax administration, the output showed that (β=0.243; p=0.039). Finally, on the relationship between alternative dispute resolution and tax administration, the analysis showed that (β=0.353; p=0.000). The study found out that tax appeal tribunal, internal tax review and alternative dispute resolution significantly affects tax administration but the alternative dispute resolution was the main contributor to tax administration. The study recommended that the KRA tax audits cases have to be reviewed by the independent panel review within the department who has no previous involvement with the audit or case work to review the technical merits of an audit position, before the matter is finalised.
Description
Tax Administration
Keywords
Alternative Dispute Resolution, Internal Tax Review, Tax Appeal, Tax Dispute, Tax administration