Assessment of factors contributing to tax evasion in Tanzania: a case study of small scale businesses Kariakoo Area

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Date
2011
Journal Title
Journal ISSN
Volume Title
Publisher
University of Dar es Salaam
Abstract
The main objective of this study was to assess factors contributing to tax evasion by small scale businesses in Tanzania: the case study of Kariakoo shopping circa, the biggest shopping area in Tanzania. Sample analysis was based on 90 formal micro and small business enterprises and 18 TRA managerial state's whom were randomly selected to participate in the study. Survey method was used to gather data using structured (questionnaires from small business entities and in four departments of TRA. The research was also developed from readings in various sources of existing literatures on tax evasion in small business scale that has facilitated formation of the research problem statement and research questions. Quantitative methods of analysis were used to categorize respondents in order to get their characteristics. The study used structured questionnaires, which were issued to different levels of respondents in small business enterprises and to TRA staffs. The research findings indicated that, high tax rates, peer's pressure, lack of confidence/mistrust of government revenue expenditure, complexity of tax system and procedures, profit maximization. low risk of detection/caught, poor tax administration and management, interruption and protection of both political and government leaders to small business traders, persistent increase in exchange rate, many taxes are levied in a single transactions, difficult in acquiring capital, TRA staff shortage, tax payers attitude and perception on fairness of tax payments, lack of knowledge regarding tax payment and corruption and bureaucracy are the factors contributing to tax evasion in formal small and micro business enterprises in Tanzania. Therefore, TRA must employ strategies to reduce level of tax evasion and encourage voluntary tax compliance behaviour among small business enterprises. This is achieved by increased an administrative efficiency by minimizing real resources needed by TRA to administer taxes payable by small businesses, enhancing compliance by minimizing time and trouble in filling relevant forms and up and down movements to TRA offices every month.
Description
Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class mark (THS EAF HJ2348.5.T34M37)
Keywords
Tax evasion, Small business, Kariakoo market
Citation
Massawe, O.G.(2011) Assessment of factors contributing to tax evasion in Tanzania: a case study of small scale businesses Kariakoo Area. Master dissertation, University of Dar es Salaam. Dar es Salaam.