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This study has explored the impact of new tax measures on revenue collection in
Tanzania. The study has employed use of case study research design and was centred
within the context of new tax measures on personalized vehicle number plates as a
case study.
It involved interview with 55 drivers and collection of quantitative data from 15 tax
administrators through questionnaires. The data obtained were analysed and presented
in a cross tabulated and descriptive form and a simple agreement mean percentage was
used to establish statistical associations between variables. The results indicate that the
trend of tax revenue performance in the past three years suggests positive effect of new
tax measures on tax collection in Tanzania. In 2014/15 revenue performance was
94.5%, but this has been surpassed by tax revenue performances against set targets in
the past three years were in 2015/16 was 105%, in 2016/2017 was 107% and in
2017/2018 was 108%. In the same period the high tax rates have negatively impacted
personalized vehicle on plate sales and tax revenue collection. Based on the study
findings the strategic thinking to improve performance of new tax measures includes;
rethinking on more creative and innovative ways of extending tax bases, expanding
the scope of personalized vehicle plate, continued taxpayer education, public
marketing communication, to strengthen customer relationship management, and
ensure that tax is collected from all possible collectable sources. The findings have
indicated high feasibility of extending personalized plates to other potential groups
including motorcycles, tri motorcycles, and executive hotels. Conclusively, the study
findings have indicated a general impressive positive impact of new tax measures on
a net tax revenue collection. Taking personalized vehicle plates as a new tax measure
high tax rate imposition had negative effect on tax returns. Key recommendations of
the study include; (i)extend personalized number plate to other potential tax payer
groups like motorcycles, tri motorcycles, and executive hotels, (ii)collecting tax from
all possible collectable sources, (iii)redesigning the price of personalized and if
possible the prices of a single plate should be determined by type or model of a given
car. |
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