The Revenue Collection and Collection Performance in Local Governments in Uganda: Case Study of Kampala City Council Authority (KCCA)
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Date
2013-08
Authors
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Publisher
Kampala International University, College of Economics and Management Sciences .
Abstract
This study was carried out to assess the problems faced in revenue collection and collection
performance in local government in Uganda with a case study on Kampala City Council
authority. The study was prompted by the persistent revenue shortfalls that have made it
difficult for the local governments in general and Kampala City Council authority in
particular to fully implement their budgets.
The study aimed at evaluating the causes of Tax Evasion, Tax Avoidance, corruption and
other factors affecting revenues collected.
The specific objectives of the study were;
To examine the factors affecting revenue collection perfonnance in KCCA.
To examine the causes of tax evasion and tax avoidance among potential tax payers in KCCA.
To examine the causes of corruption among KCCA officials.
To establish the nature of the relationship between revenue collection (tax evasion, tax
avoidance, corruption) and collection performance.
The study was done based on Morgan's table with sampling of 80 people but only 51
respondents corporate and responded to the questioners. Out of the despondence 15 were
KCCA officials and the rest market vendors.
Findings of the study revealed that the major factors for revenue collection were; Level of
income of tax payers, willingness of tax payers, level of tax administration, and existence of
various Acts among others. The study further revealed that the causes of tax evasion were
revealed as, poor record management, high tax rates, tax payers not knowing the value of
paying taxes among others. The study also revealed the cause of tax avoidance revealed as;
poor record management of revenue collection and tax payers avoiding tax charges for their
personal benefit. And also the study revealed Corruption within KCCA officials caused by
corrupted revenue collection officials, the society corrupting the officials for their personal
gain in order to pay less tax.
It was discovered that revenue collections are always short of targets basically due to high
rates of tax evasion, tax avoidance and some corruption tendencies. The relationship between
tax evasion, tax avoidance and revenue collection was determined using Karl Pearson's
correlation coefficient. It was concluded that there is a strong positive relationship meaning
that the low levels of tax revenues are significantly due to tax evasion, tax avoidance and also
with other factors taking a light blame.
It was recommended among others that; KCCA should revise its tax rates with the objective
of increasing revenue through tax base widening, improve personnel training and logistical
support, engage in massive public awareness as far as the need to pay taxes is concerned as
well as providing proper accountability for the tax revenue collected.
Description
A research dissertation Submitted to the College of
Economics and Management Sciences in Partial
Fulfillment of the Requirements for the
Award of a Degree of Bachelor of
Business Administration of
Kampala International
University.
Keywords
Revenue Collection, Local Governments, Performance, Kampala City Council Authority (KCCA)