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ABSTRACT
This study identified and assessed factors leading to tax evasion and tax compliance in
Tanzania,In the case of eligible traders in Mwanza city. The study specifically intended
to identify and assess factors leading to tax evasion and tax compliance, moreover, the
study intended to assess performance of revenue collections as a result of tax
compliance and non-compliance. This explanation was assessed from randomly selected
60 eligible traders found in Mwanza. The study findings discovered that tax evasion in
Tanzania still exist despite the fact that there are tax policy, reforms and strategies as
catalyst to increase government revenues. Change of business name, closing business
during inspection, none use of receipts, incorrect sales records and hiding other
businesses were identified as ways used to evade taxes. Small returns from businesses,
high tax rates, less returns from government spending ,unaware of tax matters, the need
of high profits, irregular follow-ups from tax authorities and corrupt tax officers were
identified and assessed as contributing factors for tax evasion. Moreover, it was
observed that revenues are properly collected through the support and information
provided by tax authorities as well as tax payers awareness on tax obligations despite
the fact that non-compliance still exist. |
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