The Effectiveness of Electronic Fiscal Devices on Enhancing Tax Compliance in Tanzania.

Ngailo, Salim Maliatabu (2022) The Effectiveness of Electronic Fiscal Devices on Enhancing Tax Compliance in Tanzania. Masters thesis, The Open University of Tanzania.

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Abstract

Taxation is one of the key strategies used by most governments throughout the world to achieve long-term growth and economic development. The collecting of taxes assists the government in funding significant economic and social activities. Specifically, the study assessed the effectiveness of EFDs transparency system on taxpayers’ compliance; also, examined the effectiveness of EFDs record keeping on taxpayers’ compliance and evaluated the effectiveness of EFDs automation on taxpayers’ compliance. The study adopted a correlational research design and a quantitative approach to establish the relationship between variables. The quantitative data were collected from 93 conveniently selected TRA officials through questionnaires and analyzed through descriptive statistics as well as the multiple regressions analysis to establish the relationship between variables. The findings are presented in accordance to the specific objectives above, but the demographic characteristics of respondents are presented first. Findings revealed that EFDs transparency system and EFDs automation have a significant positive impact on tax compliance while EFDs record keeping has a positive insignificant impact on tax compliance. Therefore, the study concludes that EFDs automation and EFDs transparency are crucial for enhancing tax compliance. The study also recommends that TRA should enhance the use of EFDs by tax payers since majority of them are not using EFDs and hence, the tax compliance is low. Increasing the use of EFDs by TRA would mean that tax compliance will be enhanced. Also, TRA should enhance its administration; this includes offering the devices for free so that even those SMEs who cannot afford to buy would have them for tax compliance purposes. Keywords: Electronic Fiscal Devices, Taxation, Tax Compliance, Electronic.

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