The Effect of Revenue Collection Outsourcing Approach on Improving Murram Levy in Local Government Authorities in Tanzania

Abstract

The study assessed the effect of revenue collection outsourcing approach on improving Murram levy in local government authorities in Tanzania. The study was conducted using explanatory design since knowledge generation was facilitated through causality testing approach with three predicting variables identified for testing. They include delays in agents’ payment, tax framework and the compliance by taxpayers which were tested on revenue collections as the dependent variable. Facts on the study were obtained in Dar es Salaam city since it is the area where Murram levy is obtained at higher rate and pace than other regions specifically in Temeke Municipality as the selected case as the local government authority. Primary data were used in facilitating knowledge gathering process with facts being collected using structured questionnaires from the sample of 50 participants as employees of the local government authority (LGA). The collected results were computed in SPSS software version 23 to obtain statistics to present the results. Multiple regression analysis was used to describe the results as the outcome on the relationship between study variables. Findings revealed that all three predicting variables namely delays in agent payment, tax framework and compliance were positive and significant statistically towards revenue collections. The implication is that revenue collections through outsourcing in Murram levy in local government authorities (LGAs) is affected with delays in agent payment, compliance and tax framework. It is therefore recommended that the authority should be keen to avoid delays and assure the framework is certain to assure compliance.