Factors affecting electronic filing of returns among small and medium enterprises in Mombasa Central Business District
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Date
2019-12
Authors
Kagendo, Edna
Journal Title
Journal ISSN
Volume Title
Publisher
KESRA/JKUAT - Unpublished research project
Abstract
Kenya has been ranked among countries with low tax compliance as a result of inefficient and ineffective tax administration. Integrating the processes of registration and filing has been a big challenge too. Tax evasion also remains very high with a tax gap of about 35% and 33.1% in 2011 and 2012, respectively. Despite the introduction of an electronic filing system in Kenya, which had been perceived to solve these challenges similar challenges have persisted up to date. The purpose of this study was to establish factors affecting the filing of returns among small and medium enterprises in Mombasa Central Business district. The study was based on the technology adoption model, the theory of reasoned action and economic network theory. The research designs adopted in the study was cross-sectional survey research design. The population for the study was 250 small medium enterprises in Mombasa CBD. The study used clustered and probabilistic sampling procedure on the different wards in Mombasa CBD to arrive at a sample of 75 businesses which is a 30% on the population. A self-administered questionnaire was used to collect data. Collected data was analyzed through a descriptive and inferential analysis. The study found that user interface is a key component that affects filing of taxes among SMEs in Mombasa CBD including the ease of navigating through KRA Itax portal and ability to upload or download forms online, technical skills including spreadsheet use, knowledge of tax laws and usage of both hardware and software were very important during filing of taxes online among owners of SMEs in Mombasa CBD and finally training costs, internet costs, computer software, and hardware were not costly to maintain among owners of SMEs in Mombasa CBD. The study concluded that: there is strong and positive relationship between user interface and filing of taxes online of 0.324; technical skills including ability to use spreadsheets, knowledge of tax laws and usage of internet and E-mails were found positive and significant in filing of returns 0.474 and finally it was not costly to file returns online 0.0113. The study recommends KRA to make the website friendly in such a way that users of the system don’t have a difficult time filing taxes online, offering of workshops to small business across all regions in the country so that all SMEs owners are able to file taxes and Since cost was found not to be a major thing SMEs need to acquire the necessary ICT equipment including stable internet, both hardware and software as well as seek tax consultants to train their staff on filing taxes online to enhance higher compliance levels.
Description
PROJ KAG
Keywords
Small and Medium Enterprises, Filing of Returns