Effects of Taxpayers’ Morale on Value-Added Tax Collection in Moshi Municipality, Tanzania
Lilian O. Kawaganise1, Nyanjige Mbembela Mayala2, Hezron Onyancha3
1Lilian O. Kawaganise, Department of Economic and Business Studies (DEBS), Mwenge Catholic University, Moshi Tanzania.
2Dr. Nyanjige Mbembela Mayala, Department of Economic and Business Studies (DEBS), Mwenge Catholic University, Moshi Tanzania.
3Dr. Hezron Onyancha, Department of Economic and Business Studies (DEBS), Mwenge Catholic University, Moshi Tanzania.
Manuscript received on 09 September 2024 | First Revised Manuscript received on 28 September 2024 | Second Revised Manuscript received on 16 March 2025 | Manuscript Accepted on 15 May 2025 | Manuscript published on 30 May 2025 | PP: 1-8 | Volume-5 Issue-1, May 2025 | Retrieval Number: 100.1/ijef.B259604021124 | DOI: 10.54105/ijef.B2596.05010525
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© The Authors. Published by Lattice Science Publication (LSP). This is an open-access article under the CC-BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: Academic studies have extensively studied tax morale as an influencing factor in value-added tax (VAT) collection. Governments and tax authorities face new issues due to tax evasion, fraud, tax avoidance, and insufficient tax discipline. Additionally, there is a growing need for better justice and transparency in taxation. It necessitates the development of effective and innovative methods for collecting Value-Added Tax (VAT). The current study was conducted in Moshi Municipality to assess the effects of taxpayers’ morale on VAT collection. The study was based on the Theory of Collection Efficiency of Value Added Tax. The study population consisted of 687 taxpayers registered for VAT in the study area. A sample of 158 individuals was selected using the Yamane formula (1964). Data was collected using a questionnaire. Face-to-face and content validity were used to verify content validity. A Cronbach’s alpha coefficient test was used to assess reliability, yielding a coefficient of 0.822. A Logistic Regression model was used to analyse data, while descriptive statistics were used to organise data. The study’s findings show that taxpayers’ VAT tax morale in the study area decreases with age. Additionally, the educational background of the household is strongly associated with taxpayers’ tax morale. Furthermore, household affluence is associated with lower VAT compliance among taxpayers. On the other hand, the attendance of VAT Programmes has a significant positive effect on tax morale and collection. It is concluded that various elements, including individual variables, contextual variables, and other aspects, contribute to tax morale among taxpayers. It is recommended that governments, tax authorities, and educational program designers disseminate information and provide education to both existing and future taxpayers. It will help enhance the tax culture in the study region and, ultimately, in Tanzania.
Keywords: VAT Collection, Tax Morale, Taxpayers, Tax Administration, Tax Compliance.
Scope of the Article: Economics