A Dissertation Submitted in Partial Fulfillment of the Requirements for the Degree of Master of Business Administration in Corporate Management (MBA-CM) of Mzumbe University
Despite the fact that enforcement measures have a positive impact to tax collection, the challenge is still on their implementation, since they require a platform built to the level that does not bring about any negativity to taxpayers and eventually make them comply, an instance that results with achieving desired tax revenue collection.
It has been argued that lack of voluntary tax compliance appears to be one of the undermining factors that attributes to the failure of the government to collect tax revenue to the required level as a result failure to meet its obligations. Short of tax revenue due to low voluntary compliance has caused tax administration body to resort to increase of enforcement measures which are geared to bridge the collection gap hence achieve goals.
This paper reviews extant literatures with focus on enforcement and voluntary compliance, and their relation to taxpaying. After better understanding of the matter, and through the use of a case study design, data collected from the field was analysed to examine the effects of increase of enforcement measures to voluntary tax compliance in Tanzania, specifically in Ilala, Dar es Salaam.
From the study it has been observed that enforcement measures are not that much bad as far as tax collection is concerned since they are part and parcel to achieving collection targets, but there are other factors which are behind low voluntary compliance some of them are as follows; poor governance, narrow tax base, high tax rates, mismanagement of public funds, lack of tax knowledge, lack of benefit incentive from government‟s provision.