Does Timely Filing through Electronic Systems Helps Monitoring of Value Added Tax Returns in Moshi Municipality Tanzania?

Abstract

Governments around the world struggle in increasing revenues for provision of social services. The main source of government revenues is from taxes collected by the government. To increase this revenues simplification of the tax compliance procedure while avoiding tax evasion is essential. Among the methods employed by the revenues Authorities is the Introduction of electronic filing systems in their operations. This study sought to assess the role of timely filing through electronic system in monitoring Value Added Tax in Moshi Municipality, Tanzania. The study was informed by the Technology Acceptance Model (TAM) while the population of the study comprised of 680 VAT-registered taxpayers. A sample of 251 determined using Yamane (1964) formula was used for the study. Data was collected using a questionnaire administered to VAT taxpayers and key informant interviews administered to TRA officials. Validity was ensured through the literature and discussion of the tools by experts at the University while reliability was assessed by the use of the Cronbach alpha coefficient where a value of 0.756 was obtained. Findings indicated that, indicators of timely filing through the electronic system were below the average point of agreement that the system facilitates monitoring of VAT returns in the study area. It is concluded that timely filing through the e-system is an efficient tool of VAT returns monitoring. It is recommended that, TRA should ensure that the system is well maintained by ensuring that the tax authority employs well-trained and qualified staff to manage the system and ensure that tax payers’ awareness campaigns are conducted so that all taxpayers comply on timely filing of their tax dues through the electronic system at their dispose.