Factors affecting Tax Compliance of Motor Vehicle Dealers in Mombasa County
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Date
2020
Authors
Ohola, Corazon Aquino
Journal Title
Journal ISSN
Volume Title
Publisher
KESRA/JKUAT - Unpublished research project
Abstract
Despite many tax changes, code of tax in Kenya is still complex, described by irregular and insufficient tax collection, a small tax base with high tax rates and low compliance. This study sets out to determine the factors influencing tax administration among motor vehicle dealers in Mombasa County. The study specifically established the effects of tax incentives on tax compliance, determine the effects of compliance costs on tax compliance, examine the effects of Information, Communication and Technology on tax compliance and establish the effects of tax incentives on tax compliance among motor vehicle dealers in Mombasa County. The study is based on three theories. The theories were technology determinism theory, transactional cost theory and Psychological and Economic Theory. The study analysed other studies used in this field, critique the studies and come up with research gaps that were beneficial for future studies. Data analysis was the instruments used for collecting data. This was a descriptive study. The target population were 221 respondents. The study adopted a stratified random sampling technique to involve 142 respondents. Reliability of the instruments was determined by piloting the instrument and validity was enhanced by discussion with supervisors and reliability was tested by figuring Cronbach’s Alpha coefficient. Data was subjected to descriptive statistics and analysed using SPSS and frequency tables and graphs were used for presentation. From the results, an R of 0.621 shows that there is a positive correlation between factors influencing tax compliance among motor vehicle dealers in Mombasa County. The adjusted R square of 0.380 indicates that taxpayer incentives, compliance costs and Information Communication Technology in exclusion of the constant variable explained the change in tax compliance by 38%, and the remaining percentage can be explained by factors not included in the model. The study recommends that the KRA should enhance taxpayers’ knowledge on tax compliance among motor vehicle companies. This can be done through training by attending workshops and seminars. KRA should enhance tax incentives in order to enhance tax compliance among motor vehicle companies. This can be enhanced through strict rules and regulations formulation. The Information Communication Technology should be enhancing in motor vehicle companies in tax compliance. Opportunities for further research still exist in this area. The study assessed factors affecting tax compliance of motor vehicle dealers in Mombasa County. Therefore, further research should be carried out in types of companies in other counties.
Description
Tax Administration
Keywords
Information Communication and Technology, Tax compliance, Tax Incentives, Compliance cost, Filing returns, Tax Rates