Effect of Taxpayer sensitization channels on Voluntary Compliance in residential Income Tax among registered landlords in Embu Town.
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Date
2021
Authors
Gitari, Milka
Journal Title
Journal ISSN
Volume Title
Publisher
KESRA/Moi University
Abstract
The research broadly aimed at establishing the effect of taxpayer sensitization channels
on voluntary compliance in residential income tax among registered landlords in Embu
Town. The specific objectives were to establish the effect of taxpayer sensitization
through tax seminars on voluntary income tax compliance in residential income tax, the
effect of taxpayer sensitization through media services on voluntary compliance in
residential income and lastly to determine the effect of taxpayer sensitization through
mobile services on voluntary income tax compliance in residential income tax. The
problem that the researcher set out to solve was that, compared to Embu, the towns in
its neighborhood which have witnessed almost the same level of economic growth as
Embu, have similar annual targets and are interestingly comparatively smaller in size
appear to be doing better than Embu in terms of residential income tax performance
from 2016 - 2020. The researcher adopted a causal research design to determine how
taxpayer sensitization through tax seminars, media services and mobile services affect
performance of residential income tax in Embu town. The researcher used primary data
collected from 120 questionnaires randomly distributed to taxpayers belonging to the
sampling frame of registered landlords within Embu town. The Economic Deterrence
Theory, Equal Sacrifice Theory and Financial Literacy Theory guided the study. From
the findings of the multiple regression analysis, the study established that holding other
factors constant, a unit increase in Tax Seminars would lead to a 0.271 unit increase in
Voluntary Tax Compliance in Residential Income tax among registered landlords in
Embu town as shown by (β1=0.271, p=0.002<0.05). The study also established that
holding other factors constant, a unit increase in Media Services would lead to a 0.335
unit increase in Voluntary Tax Compliance in Residential Income among registered
landlords in Embu town as shown by (β2=0.335, p=0.000<0.05). The study further
established that a unit increase in Mobile Services would lead to a 0.242 unit increase
in Voluntary Tax Compliance in Residential Income among registered landlords in
Embu town as shown by (β3=0.242, p=0.013<0.05). The study concluded that taxpayer
sensitization has a significant and positive effect on voluntary tax compliance in
residential income tax among registered landlords in Embu Town. The study
recommended that to ensure even more enhanced voluntary tax compliance, KRA
should heavily invest in taxpayer sensitization through media services where the
audience reached at once is highest. The study also recommended that KRA should
consider setting up more satellite stations geared towards bringing taxpayer services
closer to the people. Given that all the three predictor variables explain 54.7% of all
changes in voluntary compliance in Residential Income tax among registered landlords
in Embu town, Kenya and that 45.3% of all changes were explained by other factors
not included in the study, other studies should be conducted to determine, the effect of
tax clinics on voluntary income tax compliance among registered landlords in Embu
Town.
Description
Keywords
Taxpayer Sensitization, Tax Seminars, Mobile Services, Media Services