Factors affecting tax administration in the informal sector: a case study of Lusaka district.
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Date
2023
Authors
Mtonga, Violet
Journal Title
Journal ISSN
Volume Title
Publisher
The University of Zambia
Abstract
The Study is an evaluation of Factors Affecting Tax Evasion in the Informal Sector: A case Study of Lusaka. The study was guided by the following objectives, To establish factors that lead to non-compliance on tax remittance in informal sector. To identify the challenges that affect revenue mobilization by Zambia Revenue Authority from the informal sector and to determine how ZRA can improve upon tax collection in the informal sector by incorporating good tax Administration principles,procedures and practices in Zambia. The study adopted a mixed method design that was used in this study was a convergent parallel mixed-methods design. An approach to inquiry that embeds both qualitative and quantitative methods concurrently, prioritizing both methods almost equally throughout the process of data collection. A total of sixty – eight (68) respondents were interviewed and with closed and open-ended questions. A total of three (3) ZRA key informants were interviewed with open ended questions. The research used mixed method research design in order to come up with the findings. The research also used both secondary and primary data. The empirical result obtained from the study showed that tax evasion in the informal sector is mainly influenced by low incomes, illiteracy, complicated tax processes and the tax rate been too high. The study also established that the non-permanent place of work of informal sector participants, cash-based transactions and poor record keeping in the sector were among the many challenges that the Zambian Revenue Authority faced in taxing the informal sector. The study also found out that Tax advertisement and education, increase of ZRA pay points, Mandatory registration of informal businesses would encourage the informal sector to pay tax. Finally, study has recommends among othe that the Zambian government in conjuction with ZRA should reduce tax rates, expand tax pay points, embark on serious tax education and advertisement, employ more tax administrators and simplify the process of
remitting tax in order to increase tax revenues from the informal sector.
Description
Thesis of Master of Science in Human Resource Management