The impact of selected factors on vat compliance: the case of Kibaha district

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University of Dar es Salaam
In a bid to increase revenue collection, the Tanzania Revenue Authority (TRA) has introduced VAT in the place of sales tax. The VAT being taxed on goods, services and some importations has resulted in more revenue collection as the last consumer is the one who pays it. To further enhance VAT`s collection, the traders who are agents have to comply with the rules and regulations. The TRA on its part should enhance VAT compliance by proving proper education and adequate support to the traders who are registered taxpayers. On the whole, this study was aimed at assessing the impact of the selected factors on VAT compliance. The empirical literature review on tax evasion research in general, has revealed that high tax rates, multiple taxes, inadequate information on tax matters provided by TRA to traders have a bearing on tax compliance. The population for this study was the Kibaha district VAT registered traders. In all, 50 traders were selected using simple random sampling to take part in the study. Both primary and secondary methods were used to collect data whose analysis was facilitated by the Software Package for Statistical Sciences (SPSS). The study findings show that taxpayer education has a great potential in positively influencing VAT compliance if properly instituted. High tax rates, complicated procedures and multiple taxes were also found to undermine VAT compliance. To redress the situation, more education to the tax payers is necessary and at more regular intervals.
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Taxpayer compliance, Value-added tax, Kibaha district, Tanzania
Tarimo, N. L (2012) The impact of selected factors on vat compliance: the case of Kibaha district, Master dissertation, University of Dar es Salaam (Available at