Effects of electronic tax systems on tax compliance in Uganda
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Date
2024-09-16
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Guma Musiimenta Daniella
Abstract
The first chapter in this study was an overview that discussed problems of small businesses compliance with tax and how electronic systems can play a major function to overcome these issues. The research problem was the poor tax compliance in Uganda among SME sector. We set these goals within the scope of assessing EFRIS, EBMs and mobile payment systems in improving compliance. The chapter also explained the importance of the study in aiding tax policy development and improved revenue generation for economic growth. Because of this, the scope and boundaries as well as the research questions were set to lead a study on digital tax systems implications for SMEs.
Existing literature on the use of electronic tax systems, globally and within Uganda was carefully reviewed in Chapter 2. Theoretical frameworks underpinning tax compliance and digitalisation, such as the theory of planned behaviour have also been examined. Furthermore, the chapter thoroughly reviewed prior research on EFRIS, EBMs and mobile payment systems in relation to tax compliance. Concurrently, comparative analysis from other countries including Kenya, Tanzania and Italy added value into what best practice and challenged faced in different settings. The literature review further highlighted that current research on the long-term ramifications of these technologies to SMEs in Uganda are not comprehensive, or location specific leading us towards our goal.
This was followed by chapter 3 that discussed the method used in doing the study. A mixed descriptive research design were used in this study which is both qualitative and quantitative. The study population comprised the SMEs in Uganda, using Krejcie and Morgans formula to determine sample size. Surveys and interviews with SME proprietors were used to collect data. In this chapter the data collection instruments such as structured questionnaires and semi-structured interviews have been discussed. To examine the effects of electronic tax systems on compliance, data analysis techniques such as descriptive statistics and a thematic approach have been employed. During the execution of our research, we followed ethical standards, respecting confidentiality rights and data credibility.
This Chapter 4 focused on the analysis of the data collected from the respondents. It has been revealed that EFRIS, EBMs and Mobile Payment Systems were efficient in enhancing tax compliance in as far as improvement in the accuracy of transactions and reduction of tendencies to evade taxes is concerned. However, integration of AI solutions was costly and demanded technical expertise which not all winch SMEs were ready to adopt. It has also focused on other building factors such as government programs, financial rewards, training aimed at promoting the inclusion of such systems.
In conclusion, the findings of this study have revealed that electronic tax systems positively influence Tax compliance among SMEs in Uganda though with limitations (Chapter 5). The chapter included recommendations for government and tax agencies to increase adoption of these systems, such as expanding training courses, providing financial incentives or improving technical support. It has also been urged to create compliance culture by spreading awareness among public. The recommendations from the study emphasize on further research, particularly seeking insights that can tip into longterm impact of digital tax systems and opportunities for integrating newer technologies to enhance voluntary compliance with taxes in Uganda's SME sector.