Effect of electronic commerce on tax collection by Kenya Revenue Authority in Mombasa County
Loading...
Date
2019
Authors
Ayuma, Raphael Ongeri
Journal Title
Journal ISSN
Volume Title
Publisher
KESRA/JKUAT - Unpublished research project
Abstract
Kenya’s economy is hanging on the balance in terms of its financial stability and economic freedom, thanks to the escalating levels of national debt exerting lots of pressure to the revenue authority to hit their revenue collection targets. The main challenge facing Kenya Revenue Authority is the efforts to persuade or rather force the taxpayers to comply with the existing tax regulations hence make them pay their due share of taxes. E-commerce sector has been growing tremendously over the years but there is no significant increase in revenue collected as most of them go unnoticed by the revenue authorities, yet they have a greater potential of generating lots of revenue. This has created many questions from the government and the relevant authorities thus the study sort to investigate effect of electronic commerce on tax collection by Kenya Revenue Authority in Mombasa County. The specific objectives guiding the study are; to evaluate the effect of business-to-business electronic commerce on tax collection by Kenya Revenue Authority in Mombasa County. To determine the effect of business to consumer electronic commerce on tax collection by Kenya Revenue Authority in Mombasa County. To assess the effect of consumer-to-consumer electronic commerce on tax collection by Kenya Revenue Authority in Mombasa County. The main theories include; ability to pay theory, cost of service theory and benefit received theory and descriptive cross-sectional study employed. The target population was 1457 Kenya Revenue Authority staff in Domestic Tax Department, as detailed in the Kenya Revenue Authority human resource records, 130 e-commerce businesses and 246 e-commerce consumers in Mombasa County as contained in the Communication Authority of Kenya database. A sample size of 94 selected using stratified random sampling and grouped into three strata consisting of Kenya Revenue Authority staff; e-commerce businesses; e-commerce consumers. Quantitative data collected using a structured questionnaire tabulated, coded and analyzed using Statistical Package for Social Sciences version 24. The significance of the regression was tested and the findings led to the conclusion that business-to-business, business to consumer, and consumer-to-consumer e-commerce positively influenced tax collection by Kenya Revenue Authority in Mombasa County. The p -values for all the variables were less than 0.05, hence statistically significant. The study recommended that investigation and subsequent improvement in the organizational policies within the revenue authority and embrace those that are in line with the new operational framework which are technology intensive. Training of revenue staff on transfer pricing issues especially the intangibles, and equip them with all methods of applying transfer pricing and application of the advanced technologies that are essential for the performance of their operations. Also simplification of legislation and provide for new ways and means of interpreting and determining the nature and characteristics of income especially from e-commerce transactions. The study made suggestion for further study on other variables such as consumer to business, business to government, and consumer to government e-commerce in Mombasa County and the other counties to draw concussive view on the study. In addition, a repetition of this study be conducted using a larger sample size, in other parts of the country and using a combination of other data-collecting instrument such as interviews and focus group discussions to help in counter checking the evidence provided.
Description
PROJ AYU
Keywords
e-commerce, Tax Collection, Mombasa County