Factors For Acceptance of Electronic Fiscal Devices by Small and Medium Enterprises in Tanzania

Deogratias Dafi; Felix  Joseph Chille

doi:10.47742/ijbssr.v4n6p2

Authors

Deogratias Dafi College of Business Education
Felix Joseph Chille

DOI:

https://doi.org/10.47742/ijbssr.v4n6p2

Keywords:

EFD, Effort Acceptance, Performance Expectancy, Perceived Trust, UTAUT

Abstract

The study aimed to assess factors for the acceptance of Electronic Fiscal Devices by small and medium enterprises in Tanzania. The UTAUT model without moderating factors, such as gender, age, and factors, guided this study. The constructs of perceived trust were added as a theoretical contribution to the study. The study employed the Survey strategy in data collection by administering the questionnaires. A sample of 400 respondents was drawn from the population under the study. Quantitative data were analyzed based on descriptive statistical analysis and multiple linear regression Analysis. The survey strategy was employed, and questionnaires were administered to collect data. The sample consisted of 400 respondents selected from the target population. Quantitative data was collected and analyzed using a multiple linear regression model. The study's findings revealed that performance expectancy and effort expectancy significantly acceptance of electronic Fiscal devices (EFD) among business owners in Tanzania. However, perceived trust was found to not influence acceptance of Electronic Fiscal devices (EFD) among business owners in Tanzania. These results validate the UTAUT model and highlight the significance of performance expectancy and effort expectancy in influencing the acceptance of electronic Fiscal devices (EFD) among business owners in Tanzania. Additionally, the inclusion of perceived trust as a construct in the study model, suggests that tax authorities in Tanzania should explore other determining factors beyond perceived trust to enhance acceptance of electronic Fiscal devices (EFD) among business owners in Tanzania.

Downloads

Download data is not yet available.

References

Adu, K. O., & Amponsah, S. (2020). Correlates of tax registration compliance among self-employed in Denkyira corridor of Ghana. International Journal of Law and Management, 62(4), 365–379. https://doi.org/10.1108/IJLMA-07-2018-0137

Ali, Merima, Fjeldstad Odd-Hedge, S. I. H. (2013). Factors affecting tax compliance attitude in Africa: Evidence from Kenya, Tanzania, Uganda and South Africa Paper prepared for Centre for the Study of African Economies 2013 Conference Oxford, 17-19 March 2013 1 Introduction. Chr. Michelsen Institute, 1–26.

Allingham, M.G. and Sandmo, A. (1972). No Title Income tax evasion: a theoretical analysis. Journal of Public Economics, 1(3/4), 323–338.

Azlan Annuar, H., Isa, K., Ibrahim, S. A., & Solarin, S. A. (2018). Malaysian corporate tax rate and revenue: the application of Ibn Khaldun tax theory. ISRA International Journal of Islamic Finance, 10(2), 251–262. https://doi.org/10.1108/IJIF-07-2017-0011

Bank, W., & Surveys, E. (2015). www.econstor.eu

Bello, K. B., & D, I. D. P. (2014). Sains Humanika Review of Models / Theories Explaining Tax Compliance Behavior. SAAPAM Limpopo Chapter 5th Annual Conference Proceedingsains Humanika, 3(2014), 35–38.

Bornman, M., & Ramutumbu, P. (2019). A conceptual framework of tax knowledge. Meditari Accountancy Research, 27(6), 823–839. https://doi.org/10.1108/MEDAR-09-2018-0379

Casey, P., & Castro, P. (2015). Electronic Fiscal Devices (EFDs) An Empirical Study of their Impact on Taxpayer Compliance and Administrative Efficiency. IMF Working Paper, WP/15/73, 1–56.

Chalu, H., & Mzee, H. (2018). Determinants of tax audit effectiveness in Tanzania. Managerial Auditing Journal, 33(1), 35–63. https://doi.org/10.1108/MAJ-06-2016-1390

Chauke Tirhani Group, K., & Sebola, U. M. (2016). Reflection on the Deterrence Theory of Taxation in the Context of Revenue Collection by Municipalities and the South African Revenue Service. SAAPAM Limpopo Chapter 5th Annual ConferenceProceedings,83–88.

Che Azmi, A. A., Zainuddin, S., Mustapha, M. Z., & Nawi, Y. (2016). The Mediating Effect of Tax Fairness on the Relationship Between Knowledge, Complexity and Voluntary Tax Compliance. Asian Journal of Accounting Perspectives, 9(1), 1–12. https://doi.org/10.22452/ajap.vol9no1.1

Chege, A., Kiragu, N., Lagat, C., & Muthoni, G. (2015). Effect of Electronic Fiscal Devices on VAT Collection in Tanzania: A Case of Tanzania Revenue Authority. European Journal of Business and ManagementOnline), 7(33), 2222–2839.

Chille, F., Shayo, F., & Kara, N. (2021a). The effects of perceived trust and ease of use on the adoption of mobile marketing in the telecommunication industry of Tanzania. American Scientific Research Journal for Engineering, Technology, and Sciences (ASRJETS), 76, (1), 155-168

Chille, F. J., Shayo, F. A., & Kara, N. S. (2021b). Adoption of mobile marketing in the telecommunication industry of Tanzania: The effects of perceived usefulness, ease of use, and customer’s knowledge. European Scientific Journal, ESJ, 17(12),160 - 180

Chong, K. R., Yusri, Y., Selamat, A. I., & Ong, T. S. (2019). Tax climate manipulation on individual tax behavioural intentions. Journal of Applied Accounting Research, 20(3), 230–242. https://doi.org/10.1108/JAAR-01-2019-0001

Clifford Machogu, D. G., & Jairus Amayi, D. B. (2013). The Effect of Taxpayer Education on Voluntary Tax Compliance, Among SMES in Mwanza City-Tanzania. International Journal of Marketing, Financial Services & Management Research, 2(8), 12–23. www. indianresearchjournals.com

Colliver, J. A. (2002). Constructivism: The View of Knowledge That Ended Philosophy or a Theory of Learning and Instruction? Teaching and Learning in Medicine, 14(1), 49–51. https://doi.org/10.1207/S15328015TLM1401_11

Creswell, J. W. (2014). A. C. I. to M. M. R. (4th ed.). C. S. P. (2014). A Concise Introduction to Mixed Methods Research (4th ed,). Sage Publications.

Devos, K. (2007). Measuring and analysing deterrence in taxpayer compliance research. Journal of Australian Taxation, 10(2), 182–219.

Eilu, E. (2018). Adoption of Electronic Fiscal Devices (EFDs) for Value-Added Tax (VAT) Collection in Kenya and Tanzania: A Systematic Review. The African Journal of Information and Communication (AJIC), 22, 111–134.

Eliamini, P. (2018). Factors Influencing Tax Compliance Attitude in Small and Medium Enterprises (SMEs) in Tanzania.

Elly, T. (2015). Attitude Towards Tax Compliance among SMES in Tanzania. ORSEA Journal, 5(1), 54–75.

Fjeldstad, O.-H., Schulz-Herzenberg, C., & Sjursen, H. I. (2012). Peoples’ views of taxation in Africa: Theories, evidence and an agenda for future research.". ICTD Working Paper, 1–46.

Fjeldstad, O. H., Kagoma, C., Mdee, E., Sjursen, I. H., & Somville, V. (2020). The customer is king: Evidence on VAT compliance in Tanzania. World Development, 128, 104841. https://doi.org/10.1016/j.worlddev.2019.104841

Gangl, K., Hofmann, E., & Kirchler, E. (2015). Tax authorities’ interaction with taxpayers: A conception of compliance in social dilemmas by power and trust. New Ideas in Psychology, 37, 13–23. https://doi.org/10.1016/j.newideapsych.2014.12.001

Gilligan, G., & Richardson, G. (2005). Perceptions of tax fairness and tax compliance in Australia and Hong Kong a preliminary study. Journal of Financial Crime, 12(4), 331–343. https://doi.org/10.1108/13590790510624783

Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2010). Multivariate Data Analysis (7 ed.). Pearson Printice Hall.

Heale, R., & Twycross, A. (2015). Validity and reliability in quantitative research Validity and reliability in quantitative studies. Evidence-Based Nursing, January, 1–4.

Ikasu, E. (2014). Assessment of Challenges Facing the Implementation of Electronic Fiscal Devices (EFDs) in Revenue Collection in Tanzania. International Journal of Research in Business and Technology, 5. https://doi.org/10.17722/ijrbt.v5i3.349

Inasius, F. (2019). Voluntary and Enforced Tax Compliance: Evidence from Small and Medium-sized Enterprises in Indonesia. Advances in Taxation, 26, 99–111. https://doi.org/10.1108/s1058-749720190000026006

Jimenez, P., & Iyer, G. S. (2016). Tax compliance in a social setting: The influence of social norms, trust in government, and perceived fairness on taxpayer compliance. Advances in Accounting, 34, 17–26. https://doi.org/10.1016/j.adiac.2016.07.001

Kalita, U., & Barua, N. A. (2019). Determining a carbon tax rate for India in the context of global climate change. International Journal of Recent Technology and Engineering, 8(3), 8185–8191. https://doi.org/10.35940/ijrte.C6655.098319

Kannan, S. Somasundaram, K. (2017). Autoregressive-based outlier algorithm to detect money laundering activities. JournalofMoneyLaundering Control, 20(2), pp.190-202. https://doi.org/10.1108/JMLC-07-2016-0031

Kibiwott, M. M. (2015). Determinants of Tax Compliance among Small and Medium. Governement Information Qaurtely, 27(11), 87–93.

Kira, A. R. (2016). The Perceptions of Taxpayers on the Adoption of Electronic Fiscal Devices (EFDs) in Revenue Collection in Tanzania: The Case of Dodoma. International Journal of Academic Research in Business and Social Sciences, 6(12), 39–55. https://doi.org/10.6007/IJARBSS/v6-i12/2468

Kirchler, E., Muehlbacher, S., Kastlunger, B., & Wahl, I. (2010). Why pay taxes?: A review of tax compliance decisions. Developing Alternative Frameworks for Explaining Tax Compliance, 9780203851(December), 15–31. https://doi.org/10.4324/9780203851616

Kogler, C., Muehlbacher, S., & Kirchler, E. (2015). Testing the “slippery slope framework” among self-employed taxpayers. Economics of Governance, 16(2), 125–142. https://doi.org/10.1007/s10101-015-0158-9

Kothari, C.R & Carg, G. (2014). Research Methodology, Methods and Techniques(3rd ed). New Delhi. New Age International(P) Ltd.

Levin, J., & Widell, L. M. (2014). Tax evasion in Kenya and Tanzania: Evidence from missing imports. Economic Modelling, 39, 151–162. https://doi.org/10.1016/j.econmod.2014.02.021

Lois, P., Drogalas, G., Karagiorgos, A., & Chlorou, A. (2019). Tax compliance during fiscal depression periods: the case of Greece. EuroMed Journal of Business, 14(3), 274–291. https://doi.org/10.1108/EMJB-02-2019-0028

Lwoga, E. T., & Komba, M. (2015). Antecedents of continued usage intentions of web-based learning management system in Tanzania. Education + Training, 57(7), 738–756. https://doi.org/10.1108/ET-02-2014-0014

Macdonald, Z., & Pyle, D. (2018). Illicit activity: The economics of crime, drugs and tax fraud. Illicit Activity: The Economics of Crime, Drugs and Tax Fraud, 1, 1–289. https://doi.org/10.4324/9781315185194

Mboma, D. (2012). Challenges to Electronic Fiscal Devices adoption in Tanzania. In Saarbrucken: Lambert Academic Publishing.

Muzakkir Indrijawati, A. syamsuddin. (2019). The Determinant Effect of Theory of Planned Behavior and Tax Knowledge on Taxpayer Compliance. International Journal of Innovative Science and Research Technology, 4(11), 31–41.

Night, S., & Bananuka, J. (2019). The mediating role of adoption of an electronic tax system in the relationship between attitude towards electronic tax system and tax compliance. Journal of Economics, Finance and Administrative Science, 25(49), 73–88. https://doi.org/10.1108/JEFAS-07-2018-0066

Nkundabanyanga, S. K., Mvura, P., Nyamuyonjo, D., Opiso, J., & Nakabuye, Z. (2017). Tax compliance in a developing country: Understanding taxpayers compliance decision by their perceptions. Journal of Economic Studies, 44(6), 931–957. https://doi.org/10.1108/JES-03-2016-0061

Odd-Helge, F., Merima, A., & Lucas, K. (2019). Policy implementation under stress: Central-local government relations in property tax administration in Tanzania. Journal of Financial Management of Property and Construction, 24(2), 129–147. https://doi.org/10.1108/JFMPC-10-2018-0057

Ozili, P. K. (2020). Tax evasion and financial instability. Journal of Financial Crime, 27(2), 531–539. https://doi.org/10.1108/JFC-04-2019-0051

Rao, S. (2014). Tax Reform: Topic Guide, Birmingham. UK: GSDRC, University of Birmingham.

Rethi, G. (2012). Relation between tax evasion and Hofstede’s 4 + 2 model. European Journal of Management, 12(3), 61–72.

Saka, C., Oshika, T., & Jimichi, M. (2019). Visualization of tax avoidance and tax rate convergence: Exploratory analysis of world-scale accounting data. Meditari Accountancy Research, 27(5), 695–724. https://doi.org/10.1108/MEDAR-02-2018-0298

Saunders, M., Lewis, P., & Thornhill, A. (2012). SIXTH EDITION METHODS FOR BUSINESS STUDENTS Research Methods for Business Students Sixth edition.

Sharma, S. K., Govindaluri, S. M., & Gattoufi, S. (2015). Understanding and predicting the quality determinants of e-government services. JournalofModellingin Management, 10(3), 325–340. https://doi.org/10.1108/JM2-12-2013-0069

Sondhi, N., & Chawla, D. (2016). Research Methodology- Concepts and Cases,” . Vikas Publications.

Steenbergen, V. (2017). Reaping the benefits of Electronic Billing VAT compliance. May.

Thomas, A., Menon, A., Boruff, J., Rodriguez, A. M., & Ahmed, S. (2014). Applications of social constructivist learning theories in knowledge translation for healthcare professionals: A scoping review. Implementation Science, 9(1), 1–20. https://doi.org/10.1186/1748-5908-9-54

Finance Act 2010, Gazzete of The United Republic of Tanzania, (2010) (testimony of URT).

URT. (2013). Finance Act 2013, Gazzete of The United Republic of Tanzania. 4, 1–42.

Finance Act 2014, Gazzete of The United Republic of Tanzania, (2014) (testimony of URT).

Finance Act 2015, Gazzete of The United Republic of Tanzania, (2015) (testimony of URT).

Venkataraman, V., Usmanulla, S., Sonnappa, A., Sadashiv, P., Mohammed, S. S., & Narayanan, S. S. (2019). Wavelet and multiple linear regression analysis for identifying factors affecting particulate matter PM 2 . 5 in. International Journal of Quality & Reliability Management, 36(2017), 1750–1783. https://doi.org/10.1108/IJQRM-06-2018-0150

von Glasersfeld, E. (1984). An Introduction to Radical Constructivism. The Invented Reality, 13, 17–40. http://www.vo nglasersfeld.com/070.1

Wadesango,N;Mutema,A;Mhaka, C;and Wadesango, V. . (2018). Tax Compliance Of Small And Medium Enterprises Through The Self-Assessment System: Issues And Challenges. Academy of Accounting and Financial Studies Journal, 22(3), 1–15.

Wang, W., Chen, P., & Li, S. (2020). Generalized expected discounted penalty function at general drawdown for Levy risk processes. Insurance: Mathematics and Economics, 91, 12–25. https://doi.org/10.1016/j.insmatheco.2019.12.002

Wenzel, M. (2004). The social side of sanctions: Personal and social norms as moderators of deterrence. Law and Human Behavior, 28(5), 547–567. https://doi.org/10.1023/B:LAHU.0000046433.57588.71

Yau, A., Saad, N., & Masud, A. (2020). Effects of economic deterrence variables and royalty rates on petroleum profit tax compliance in Nigeria: an empirical analysis. International Journal of Energy Sector Management, 14(6), 1275–1296. https://doi.org/10.1108/IJESM-12-2019-0011

Water Integrity Network (WIN), Tax Compliance, https://www.waterin tegritynetwork.net/2015/12/04/tax-compliance/ Retrieved

on 17th October, 2019.

Yamane, T (1967); Statistics. An Introduction Analysis, 2nd Ed., New York; Hamper and Row