Effect of electronic tax system on rental income tax compliance by landlords in Eldoret Central Business District, Kenya
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Date
2019
Authors
Terer, Brenda Chelangat
Journal Title
Journal ISSN
Volume Title
Publisher
KESRA/JKUAT - Unpublished research project
Abstract
Taxation is a major source of revenue for most countries in the world. Therefore, governments and the revenue bodies continually put in place reforms and policies that seek to enhance revenue collection. In spite of many reforms by Kenya Revenue Authority, a lot of revenue still remains uncollected. This leads to failure by the authority to meet its annual revenue collection targets. The prime goal of this research was to determine the effect of electronic tax system on rental income tax compliance by landlords in Eldoret Central Business District. The specific objectives were to investigate the effect of electronic registration, to determine the effect of electronic filing and to find out the effect of electronic payment on rental income tax compliance by landlords in Eldoret central Business district. The study was guided by economic deterrence theory and Behavioral theory. An explanatory research design was adopted. The target population was 332 of which a sample of 181 was chosen using simple random sampling method. Primary data was collected using a questionnaire while secondary data was obtained from existing relevant sources of taxation. Regression analysis was conducted to analyze the collected data. The findings indicated a positive and significant relationship between electronic tax systems and rental income tax compliance by landlords in Eldoret Central Business District. It was established that the effect of electronic tax registration on rental income tax compliance by landlords in Eldoret Central Business District is positive and statistically significant. It was also established that the effect of electronic tax filing on rental income tax compliance by landlords in Eldoret Central Business District is positive and statistically significant. The findings also revealed that electronic payment systems have a positive and statistically significant effect on rental income tax compliance by landlords in Eldoret Central Business District. Based on the findings, the study recommends that Kenya Revenue Authority should create more awareness among the landlords in Eldoret Central Business District in order to enhance the understanding of using electronic tax systems which can in the long run improve rental income tax compliance thereby improving tax revenue. The study also recommends that Kenya Revenue Authority should hold workshops in Eldoret and train the landlords on the usage of electronic tax systems which can still improve rental income tax compliance thereby improving tax revenue in future.
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Keywords
Rental income, Tax compliance