Abstract:
The majority of developing nations rely on fiscal devices to run their governments, revenue is the
main source of public funding in these nations. However, the implementation of EFDs is not done
without challenges. So, the overall objective of this study was to assess the challenge facing the
adoption of EFD for revenue collection in Zanzibar. Specifically, the study is to examine taxpayers’
negative perceptions of the use of EFDs in revenue collection, to examine the price challenge
associated with EFDs among taxpayers in revenue collection, and also to examine the breakdown
of system and technical support of the use of EFDs in revenue collection.
This study used cross-sectional design. It’s including a mixed approach. Simple random sampling
and purposive sampling techniques used to get respondents. Data were analyzed using statistical
software for data sciences (STATA) version 17.0 represented in simple descriptive statistics such
frequencies and percentages
The findings showed that taxpayers were facing challenges in using EFD machine includes price of
EFDs was high, networking problem, delay maintenance, software problem, power outage, tax
payer not having enough education on the importance and uses of EFDs in revenue collection. Also,
majority of respondents had a negative perception toward the use of EFDs, they believed EFDs
were not an effective means of revenue collection, it causes over taxation, EFDs do not reduce
fraud and corruption, and EFDs are sold at high cost for some traders to afford. It is recommended
that ZRA should introduce EFDs that have no or less network breakdown, reduce or subsidize the
prices of EFDs, organize tax education to taxpayers, more training on how to use EFDs, the
government through ZRA should work together with other stakeholders particularly business people
in order to eliminate critical challenges facing the stakeholders.
