oa Business Management Review - Business environment and attitudes towards tax in Tanzania: implication of firm compliance behaviour

Volume 9, Issue 1
  • ISSN : 0856-2253



Compliance with tax in micro-enterprises is commonly descriptionbed as a chronic problem in many emerging economies. Not much has been done to explore the problems of compliance in this sector. This paper sets out to attempt an empirical investigation of micro-firms; behaviour in tax compliance. A simple model of tax compliance is set out to guide the arguments and discussions in this paper. Survey data from Tanzania are used in the analysis from which three major conclusions are derived Firstly, micro business firms find it difficult to settle their tax liabilities in annual lump sum payments because retention of profits is too low or absent. Secondly, micro firms appear to be surrounded by future business uncertainties that propel them to adopt short-term rather than long-term business strategies.

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