EFFECT OF OUTSOURCING REVENUE COLLECTION IN LOCAL GOVERNMENT AUTHORITY

Abstract

The study assessed the effect of outsourcing revenue collection in local government authorities (LGAs) in Tanzania. The study was guided by three predicting variables namely delays in agents’ payments, inconsistence in tax framework and limited tax compliance tested on revenue collections. Explanatory design was used to perform the study by means of relationship testing between independent variables on the dependent variable. The study used primary data that were collected from the sample of 37 respondents from the selected local government authority (LGA), using structured questionnaire. The collected information was computed and filled in the SPSS data sheet version 23.0 to produce relevant statistics to present primary data. Descriptive statistics were first used to present the demographic profile of the respondents; while correlation and multiple regression were used to describe the relationship between study variables. The findings of the study indicates that all three predicting variables to the dependent variable namely delays in agents’ payments, inconsistence in tax framework and limited tax compliance are positive with significant effect statistically on revenue collections. This implies that revenue collections through outsource practices in revenue collections in the local government authorities (LGAs) in Tanzania is affected with delays in agents’ payments, inconsistence in tax framework and limited tax compliance. The study recommended that the revenue pattern should be well reformed by the government for the agents assigned to work well in line with the expected results.