Electronic Payment and Revenue Collection in Local Government Authorities in Tanzania: Evidence from Kinondoni Municipality
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Date
2019
Authors
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Publisher
Department of Economics-University of Dar es Salaam
Abstract
This paper examines the role of e-payment on revenue collection in Kinondoni Municipal,
Dar es Salaam, Tanzania. A semi-structured questionnaire was distributed to revenue
collectors and administrators using simple random sampling procedure; obtaining a
total of 77 respondents. Data were analysed using descriptive statistics and linear
regression. The findings revealed that most of the respondents admitted that e-payment
influences revenue collection by enabling the Municipal increase tax compliance. It was
further revealed that e-payment can provide additional competitive edge in monitoring
revenue sources, and improving the quality of financial reporting. Furthermore, the
findings revealed a positive linear relationship between e-payment and revenue
collection in terms of tax compliance, monitoring of revenue sources, and financial
reporting. The study indicated that all e-payment modes are aligned with tax
compliance. Apart from positive achievements of e-payment, poor connectivity, limited
awareness, lack of technical assistance, poor experience of the technology by tax
collectors, and unreliable power supply were considered as challenges in implementing
e-payment system. Thus, to hasten the use of e-payment system in revenue collection, it
is crucial to address the identified challenges and conduct training to all tax collectors
and tax payers. Also, the geographical information system (GIS) should be integrated in
the e-payment system to automate the process of allocating revenue sources.
Description
Keywords
electronic payment, revenue collection, local government in Tanzania