Journal of
Accounting and Taxation

  • Abbreviation: J. Account. Taxation
  • Language: English
  • ISSN: 2141-6664
  • DOI: 10.5897/JAT
  • Start Year: 2009
  • Published Articles: 158

Article in Press

EFFECTS OF SHIFTING NON TAX REVENUE FROM LOCAL GOVERNMENT AUTHORITIES TO TANZANIA REVENUE AUTHORITY: THE CASE OF MOROGORO MUNICIPALITY

Mohamedi Hussein1* and John B. Tlegray2

  •  Received: 09 August 2021
  •  Accepted: 04 October 2021
The transfer of property tax and billboard fees collection from LGAs to TRA has had drastic consequences for LGAs budgets. This study seeks to examine the effects of shifting the collection of non-tax revenue from Local Government Authorities to Tanzania Revenue Authority with reference to Morogoro municipality. A sample size of 88 respondents was purposefully selected. Data were descriptively analysed and the majof findings showed that, non-tax revenue shift from MMC to TRA had various effects that include its inability to fulfill its obligations, loss of jobs to workers who dealt with revenue collection and introduction of other alternative taxes (e.g. waste disposal tax) that added burdens to tax payers. Moreover, MMC level of revenue collection was reduced to an average decrease of TZS 239 million from billboard fees and an average decrease of TZS 567 Million on property tax for the three years of 2017 to 2019. This shift rendered the MMC to fulfill its obligations with difficulties while some initiated projects becoming redundant. Similarly, the availability of poor administrative capacity to assess and broaden the revenue base due to lack of competent personnel, reduced revenue and tax evasion among dwellers, poor administrative capacity to enforce taxes introduced, corruption from revenue collectors, political interference causing relaxation on revenue collection and overdependence on central government were among the challenges. It is recommended that MMC needs to enhance its internal revenue collection system in order to be able to fulfil its obligations while facilitating voluntary and compliance payment of revenue while the system adapted by TRA on broadening the tax base needs to be adapted for MMC revenue collection enhancements as these non-tax revenue have returned to its mandate

Keywords: Non Tax Revenue, Local Government Authorities, Tanzania Revenue Authority