Abstract:
ABSTRACT
The study examined factors affecting tax morale and tax compliance in Tanzania: evidence from Arusha and Kilimanjaro regions. The study had the following research objectives; to examine how the tax purpose affect tax compliance and tax morale, to determine how tax knowledge and trust affect tax compliance and tax morale and to assess how fairness of the tax system affect tax compliance and tax morale in Arusha and Kilimanjaro regions. The study used descriptive survey research design and quantitative research approach. Cluster sampling technique was used to select sample for the study. Data were collected using structured questionnaires and were analyzed through descriptive statistics with the aid of SPSS version 22. The study found that tax purpose affected tax compliance and tax morale as if the purpose of the tax is to bring development increases people's morale to pay tax. The study also revealed that the tax knowledge and trust contributed to tax compliance and tax morale in Arusha and Kilimanjaro regions as people are more educated about the significance of paying tax, they are encouraged to pay more taxes. The study tax compliance and tax morale increases when the tax system used is fair and economical. The study recommended that tax payers should be given awareness on the importance of tax compliance and tax morale in the study area This awareness will foster their willingness of paying tax voluntarily. The study further recommended that tax authorities should make sure that they are handling of tax paying challenges, provide tax awareness to taxpayers. review the tax rates and ensure tax system is fair to all people.
