Assessing the Effective Mechanisms for Property Tax Collection in Tanzania: A Case Study of Kinondoni Tax Region

Abstract

Property tax collection in Tanzania is perceived to be ineffective, and the mechanisms for making it effective are unknown. This study investigated the effectiveness of Tanzania's property tax collection mechanisms by assessing the effectiveness of property tax collection methods, the regulatory framework used in property tax collection, and taxpayers' attitudes toward property tax collection. A sample of one hundred taxpayers and TRA officials were used in a descriptive research design. Descriptive statistics were used to analyze the data and ascertain respondents' opinions regarding Tanzania's efficient property tax collection methods.
 The study's conclusions demonstrated the following: comprehensive registration, monitoring, and follow-up on property tax payments by all owners of taxable properties was the most effective regulatory framework of property tax collection, followed by adequate monitoring and follow-up of TRA/LGAs by the central government; property taxpayers had a positive perception of property tax payment methods; and automatic deduction of property tax payable by the house/buildings when purchasing LUKU was the most effective property tax collection method compared to other collection methods followed by centralization of property tax collection to TRA. The study concluded that the most efficient ways to collect taxes are to send property tax bills and control numbers to taxpayers via their mobile phones, automatically deduct property tax when buying LUKU, and centralize tax collection to TRA rather than to LGAs.