An assessment of the efficiency and effectiveness of presumptive tax collection: A survey of bottle stores and restaurant operators in Bindura urban district.
- Author
- Munaki, David
- Title
- An assessment of the efficiency and effectiveness of presumptive tax collection: A survey of bottle stores and restaurant operators in Bindura urban district.
- Abstract
- The purpose of this study was to evaluate how efficient and effective is presumptive tax system in taxing the informal economy, using a survey of Bindura's restaurants and bottle stores. The study's primary goals were to determine the reasons why bottle stores and restaurants operators should pay presumptive tax, to identify any relationship between awareness of presumptive tax and compliance with presumptive tax ,to identify reasons for unwillingness to pay presumptive tax ,assess the efficiency and equity principle of collecting presumptive tax from bottle store and restaurant operators and to suggest measures that can be used by ZIMRA to improve presumptive tax compliance among bottle store and restaurant operators and other players in the informal sector, to determine if the presumptive tax system was the most appropriate way for taxing the informal sector. The study was descriptive in design and the main data gathering instruments for the study were interviews and questionnaires, Microsoft Excel was used to analyse data. Questionnaires where self-administered by the researcher to the respondents were drawn from a population of 95 bottle stores and restaurants and 5 ZIMRA officials. Systematic and stratified random sampling was used to select respondents .The study's findings indicated that presumptive taxation is not the most effective method of taxing the informal sector, while presumptive taxation is not the ideal method of taxing the informal sector there is still an opportunity for systemic improvement, ZIMRA is over estimating the tax rates, the other result was that the presumptive tax system needs to be restructured because it has failing to include the whole informal sector in the tax net under the current presumptive tax regime. The study's findings also revealed that ZIMRA does not regularly run awareness programs to remind the unorganized sector to pay taxes and the recommendations where that information should be made available to the tax payers, informal sector should be consulted when determining tax rates and tax agents should be utilised as well.
- Date
- June 2023
- Publisher
- BUSE
- Keywords
- Taxation
- Supervisor
- Mr. Ngwende
- Item sets
- Department of Accountancy