The impact of formalization of informal enterprises in Tanzania the case of selected informal sector in Dar es Salaam region

This dissertation presents factors limiting formalization of informal Enterprises in Tanzania, particular in Dar es Salaam. Factor that contributed to failure of formalization of informal business are Registration costs that are made up of a chain of different taxes, Bureaucracy, working premises, financial support from financing Institutions, and good Governance. All these factors were clearly identified and derived from literature, empirical study reviews and analyzed data. The study used phenomenological paradigm and relied on qualitative research approach where by descriptive primary data were analyzed from BRELA, TRA, and informal businessmen. The sample and sample size comprised of five respondents from TRA officials, five respondents from BRELA Officials, and One hundred and fifty informal business people based in Dar es salaam. Result show that many taxes charged during registration process at the initial stage, Bureaucracy, lack of financial support from financial Institutions and good Governance frustrate and hinders formalization of informal business. Overall operations were adversely affected by high costs result from registration process that include stamp duty costs, company registration process cost, as well as document keeping file costs at BRELA. Result have implication to knowledge, management practice and policy changes. The government is urged to revise its Business regulations in order to support, promote and facilitate formalization of business so as to increase National income through tax collection from business sector. Furthermore, business policy review should be undertaken to enhance good environment for business to grow, compete, improve services, and finally contribute to National income through tax