Factors Affecting Rental Income Tax Collection; A Case Study of Taxpayers in North of Nairobi District, Nairobi County
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Date
2018
Authors
Rukaria, Anne Karimi
Journal Title
Journal ISSN
Volume Title
Publisher
KESRA/JKUAT - Unpublished research project
Abstract
Effective running of devolved functions requires adequate resources. Currently the larger proportion of county government financial resources is sourced from the national government. This is attributed to the county governments’ insufficient capacity to mobilize revenues within their jurisdictions. The study aimed at establishing factors affecting rental income tax collection in the Kasarani sub county, Nairobi County, Kenya. Specifically, the study looked at landlords’ awareness level of their tax obligation, connection to iTax systems and the factors that curtail landlords from meeting their tax obligation in general. The study drew data from landlords in Kasarani sub County of Nairobi County. The study adopted descriptive research design. A sample of 330 respondents was drawn from the target population using stratified random sampling method. A structured questionnaire was administered on the sampled respondents. The questionnaire was pilot tested to authenticate its reliability and validity before it is administered in the final study. Data was analyzed descriptively and inferentially using SPSS for Windows. Findings were represented using frequency tables to ease understanding. Results from the study indicate that, first the residential income tax collection efforts have not borne much fruits as it would have been expected because quite a significant percentage of the landlords do not pay their rental income tax. Secondly, the Government is faced with numerous challenges as far as collection of residential income tax is concerned, some related to the internal infrastructure in place that supports tax collection and others related to the socio-economic in nature and include inadequate training for the landlords. Thirdly there is a strong positive correlation coefficient of 0.87. This indicates a strong positive correlation between the age of tax payer and the amount of tax paid. Recommendations from the study are for Government to ensure landlords are trained and equipped with the required skills relating to paying rental income tax. There should also be a regular awareness to the public on various tax obligations. The public should also be more enlightened on tax return and various channels through which the landlords can make use of.
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Keywords
Rental income tax