Assessment of tax payers' compliance behavior among SMEs in Tanzania

The main objective of this study was to assess the taxpayers’ tax compliance behavior among SMEs in Tanzania, the case study of mini supermarkets located at three districts of Dar es Salaam city which are Kinondoni, Ilala and Temeke. A total number of 48 respondents were included in the study, out of which thirty (30) respondents were senior managers/ accountants and business owners of mini supermarkets and 18 respondents were TRA managerial staff. Survey methods used to collect data from respondents were structured questionnaires and interviews. Collected data from respondents were analyzed using descriptive statistics, summarized and presented in the form of frequencies and percentage, tables and graphs designed in Microsoft Excel. Research findings revealed the following factors influence tax compliance behavior among SMEs, complexity of tax system, level of tax rates and compliance costs, legal and regulation procedures to run business fear of detection by TRA, existing level of tax awareness programs and treatment taxpayers receive from TRA and tax agents. Finally it is recommended that, TRA management should strengthen tax education programs and integrates it to secondary and college level so that every student in those areas can understand their responsibilities in tax compliance. Moreover, establishment of tax service centres near business areas and application of electronic banking during tax transactions will improve tax compliance behavior in SMEs.