Tax Administration Practices, Government Policies and Revenue Growth of Kisii County Government, Kenya.

Abstract

Tax administration practices provide an overview of policy design principles and their implications for tax administration by establishing linkages between tax practice and administration and showing how functions feed into one another. Revenue growth provides a conceptual framework that discusses the channels through which tax changes can affect economic performance. The purpose of the study was to evaluate the effect of tax administration practices on revenue growth of Kisii County –Government in Kenya. The specific objective includes; to examine the effect of tax collection practice on revenue growth of Kisii County Government in Kenya, to determine the effect of tax rates litigations practice on revenue growth of Kisii County Government in Kenya, to find out the effect of tax publication practice on revenue growth of Kisii County Government in Kenya and to assess the effect of Statistical tax practice on revenue growth of Kisii County Government in Kenya. The study was anchored on Allingham and Sandmo theory, ability to pay theories and tax morale theories. Cross-sectional research design was used. The study was conducted in Kisii County. The study targeted all 256 employees. The sample size of 223 comprised of 156 plus 30% of non-response respondents was selected. Questionnaires were used to collect primary data. Reliability was measured by level of consistency using test and retest method. Pilot study was done in Nyamira County using 10% of the sample size. Data for this study was analyzed using time series and panel data analysis for a period of 5 years. Regression and Correlation was used to give relationship between tax administration and revenue growth by linear regression model. The data were presented in tables. Correlation analysis showed that there was weak positive and significant correlation between tax collection procedure and revenue growth. This implied that tax collection procedures improve revenue growth of the county. The study concluded that tax publication had a strong positive correlation with significant effect on revenue growth. Government regulations play an important role in ensuring a safe, fair economy for small businesses and consumers alike, the government circulars promote tax policies on tax imposition to its people. The study recommended that property tax litigation is managed properly, Income tax litigations were adoptable to variations of taxes, and Value Added Tax is well taxed and was accepted among taxpayers using tax policies. Further study can be done on tax rates and performance of counties.