Taxes play a crucial role in the development of a nation. In Kenya, tax revenues have always failed to reach the anticipated collection targets due to many factors. The taxman has had to develop policies that aim at reforming tax management and achieve the set targets In this regard the researcher seeks to study the effects of rental tax reforms on revenue collection by the Kenya Revenue Collection agency as the main objective. The specific objectives of this study are; to identify the effect of monthly rental income on rental revenue collection, to determine the effects of withholding rental income on rental revenue collection, to find out the effect of tax amnesty on rental revenue collection and to investigate the effect of block management systems sector on rental revenue collection The study is guided by the dynamic theory of public spending, taxation, and debt and the technological advancement theory. An empirical review is also undertaken to link the independent variables to revenue collection and the research gaps arising. The study shall adopt a descriptive research design and a case of KRA shall be carried out. The target population is 500 employees and a sample size of 81 has been obtained for this matter. Questionnaires shall be used to gather primary data whereas secondary data shall be obtained from KRA, the Ministry of Finance and other relevant entities. The data shall then be analysed using IBM SPSS version 20.0, classified, tabulated and summarized using figures, summary statistics of the mean, and standard deviation percentages and frequency distribution tables. A detailed explanation of the data shall also accompany the presentation.
Table of Contents
1. INTRODUCTION
1.1. Chapter Overview
1.2. Background of the Study
1.2.1. Tax Reforms
1.2.1.1. Administrative Tax Reforms in Kenya
1.2.1.2. Policy Tax Reforms in Kenya
1.2.1.3. Technological Tax Reforms
1.2.1.4. Tax Reforms on Rental Income
1.3. Statement of the Problem
1.4. Objectives
1.4.1. General Objective
1.4.2. Specific Objectives
1.5. Research Questions
1.6. Justification of the Study
1.7. Scope of the Study
2. LITERATURE REVIEW
2.1. Introduction
2.2. Theoretical Literature Review
2.2.1. Technological Determinism Theory
2.2.2. Dynamic Theory of Public Spending, Taxation, and Debt
2.3. Empirical Literature Review
2.3.1. Monthly Rental Tax Income
2.3.2. Withholding Income
2.3.3. Tax Amnesties
2.3.4. Block Management System
2.4. Research Gaps
2.5. Conceptual Framework
Research Objectives and Focus
The study aims to evaluate the impact of various rental tax reforms on revenue collection efficiency within Kenya. It specifically investigates how recent legislative and administrative shifts, such as monthly income filing requirements, withholding tax policies, tax amnesties, and block management systems, influence the tax compliance behavior of landlords and overall revenue generation for the Kenya Revenue Authority (KRA).
- Effects of monthly rental income filing on revenue.
- Impact of withholding rental income tax policies.
- Influence of tax amnesty programs on revenue collection.
- Efficacy of the block management system in improving compliance.
Excerpt from the Book
1.2. Background of the Study
Murphy and Higgins (2016) define tax as a compulsory contribution made to a government by residents of a country or companies operating in a specific country. According to David & Norbert (2017), governments raise revenue through taxes to finance public expenditure. Taxes are used to fund education, infrastructure projects and pay salaries to civil servants. Governments use taxation as a tool to combat income inequalities by taxing high net worth individuals and companies and using the money to fund other government programs. Taxes are also used as a fiscal policy tool. Fiscal policy tools aim at controlling how much money the government or individuals should spend in specific areas of the economy. (David & Norbert, 2017).
In Kenya, the function of revenue collection is done by the Kenya Revenue Authority (KRA) which was established in 1995 by an Act of Parliament, Chapter 469 of the laws of Kenya. KRA collects six types of taxes. These types of taxes are; Income Tax, Rental Income Tax, Value Added Tax (VAT), Excise Duty and Capital Gains Tax. Income tax is charged on income from employment, professional services, and investment income among others, and it is based on tax brackets that are regularly reviewed.
Summary of Chapters
1. INTRODUCTION: This chapter provides the background on tax reforms in Kenya, outlines the research problem regarding revenue shortfalls, and details the specific objectives and scope of the study.
2. LITERATURE REVIEW: This chapter explores theoretical frameworks like Technological Determinism and the Dynamic Theory of Public Spending, while examining empirical evidence regarding rental tax income, withholding mechanisms, amnesties, and block management systems.
Keywords
Kenya Revenue Authority, Rental Tax Reforms, Revenue Collection, Tax Compliance, Monthly Rental Income, Withholding Tax, Tax Amnesty, Block Management System, Fiscal Deficit, Tax Administration, Tax Reform, Income Tax, Kenya, Public Spending, Tax Evasion
Frequently Asked Questions
What is the core focus of this research?
The research examines the effectiveness of various rental tax reforms implemented by the Kenya Revenue Authority (KRA) in enhancing revenue collection within the Kenyan economy.
What are the central themes of the work?
The central themes include the modernization of tax administration, the impact of technological tools on tax compliance, legislative changes concerning rental income, and the influence of enforcement strategies like block management.
What is the primary objective of this study?
The primary objective is to determine the extent to which specific rental tax reforms have impacted revenue collection targets set by the government.
Which scientific methodology is applied?
The study employs a descriptive research design, gathering both primary data through questionnaires from a sample of employees and secondary data from the KRA and the Ministry of Finance, analyzed using IBM SPSS software.
What topics are covered in the main body?
The main body covers the background of Kenyan tax reforms, a theoretical review of public spending and technological determinism, and an empirical analysis of specific rental tax strategies.
Which keywords characterize this study?
Key terms include KRA, Rental Tax Reforms, Revenue Collection, Tax Compliance, and Block Management Systems.
How does the block management system function according to the text?
The system segments taxpayers based on geographic locations—using roads, landmarks, and streets—to help the revenue authority audit, monitor, and enforce tax compliance more effectively.
What role does the Finance Act 2015 play in the context of this study?
The Finance Act 2015 is significant because it introduced critical residential rental income tax provisions that serve as a focal point for assessing recent changes in taxpayer behavior and government collection efforts.
- Quote paper
- Dennis Nangabo (Author), 2019, Effects of Rental Tax Reforms on Revenue Collection in Kenya, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/536251
