A Dissertation Submitted in Partial Fulfillment of the Requirements for Award of Degree of Master of Business Administration (MBA-CM) in Corporate Management of Mzumbe University
This study aimed at assessing the Factors Hindering Tax Compliance of Traders in
Tanzania with reference to Mwanza City Council. The main objective was achieved
with the following specific objectives which were to identify tax challenges facing
Traders to register themselves with tax laws, To examine the obstacles facing
Traders in collecting 18% as VAT from their customers, determination of factors
making Traders to become reluctant in using EFD Machines, and also to investigate
whether all eligible traders are actually registered in tax system.
However, the study also examined the issue of tax evasion and tax avoidance for
traders as well as the possible solution to control tax evasion and tax avoidance so as
to create voluntary tax compliance for small and medium entrepreneurs.
The study used questionnaire, interviews and relevant documents in collecting
primary and secondary data. The study found that tax compliance in Mwanza City
Council of Mwanza Region has been facing a combination of challenges (problems)
such as: misunderstanding of the public in general and the business community in
particular regarding the tax laws. It was further noted that there was resistance
against registrations for VAT and other taxes by some traders. Moreover, it was
found that some traders provide understated financial statements, while others do not
issue electronic tax invoices or issue illegal invoices. It is thus concluded that there
are various problems in the administration of tax laws in Mwanza City. On the basis
of these findings, the study recommends that the authority should train the taxpayers
about the rules and regulations of tax laws continuously and recruit new employees