Tax Compliance and Level of Tax Collection among Small and Medium Size Enterprises in Kiambu County, Kenya
Loading...
Date
2019
Authors
Wasilwa, Jackline
Ndede, Fredrick W.S.
Mungai, J.N
Journal Title
Journal ISSN
Volume Title
Publisher
Abstract
This study looked into the relationship between tax compliance and level of tax collection among small and medium size
enterprises in Kiambu County, Kenya. Specifically, the study sought to establish the effect of tax registration, declaration of income,
prompt payment of tax due and filing of returns on the level of tax collection among small and medium size enterprises in Kiambu
County, Kenya. A descriptive survey design was used for the study. The study was limited to SMEs operating in Kikuyu Sub County of
Kiambu as the study units. Secondary data was collected for the SMEs from the annual fiscal records of Kenya Revenue Authority for a
period of 5 years between 2013 and 2017. In analyzing the quantitative data, the study used descriptive statistics that included
percentages and frequencies. The analysis of the data was made with the help of Statistical Package for Social Sciences (SPSS version
23.0). Multiple regression analysis was used to establish the relationship among the study variables. The results of the study indicated
that there existed a positive and significant relationship between tax registration and the level of tax collection among SMEs in Kikuyu
Sub County (β=0.681, p-value=0.007); a positive and significant relationship between declaration of income and the level of tax
collection among SMEs in Kikuyu Sub County (β=0.707, p-value=0.001; a positive and significant relationship between prompt payment
of tax due and the level of tax collection among SMEs in Kikuyu Sub County (β=0.782, p-value=0.000 and a positive and significant
relationship between filing of returns and the level of tax collection among SMEs in Kikuyu Sub County (β=0.729, p-value=0.000.
Inflation was found to have a positive moderating effect on the relationship between tax registration, declaration of income, prompt
payment of tax due as well as filing of returns and the level of tax collection among SMEs in Kikuyu Sub County. The study thus
concluded that tax registration, declaration of income, prompt payment of tax due and filing of returns were predictors of the level of tax
collection among SMEs in devolved units in Kenya. To enhance the level of tax collection among SMEs, the study recommends that the
Kenya Revenue Authority should encourage tax registration, declaration of income, prompt settlement of tax due and filing of returns in
this category of businesses.
Description
research article
Keywords
Declaration of Income, Filing of Returns, Prompt Payment of Tax Due, Tax Registration, Tax Compliance, Tax Collection, Small and Medium Size Enterprises.
Citation
Wasilwa, J., Ndede, F. W., & Mungai, J. N. (2019). Tax Compliance and Level of Tax Collection among small and medium sized Enterprises in Kiambu County, Kenya. International Journal of Sciences and Research (IJSR).