The effects of tax administration on revenue collection in Uganda: the role of self-assessment system

Abstract

This research examines the impact of tax administration, with a focus on the self-assessment system (SAS), on revenue collection in Uganda. Utilizing data collected from 350 commercial enterprises through questionnaires, the study employs AMOS PLS-SEM for data analysis. The findings reveal that the SAS significantly enhances revenue collection by empowering taxpayers to self-report and calculate their tax liabilities, contingent upon adequate tax knowledge and awareness. The study also identifies government spending and tax collection methods as positive moderators in the relationship between SAS and revenue collection, highlighting the importance of government efficiency and transparency in fostering tax compliance. Despite the positive impact of compliance audits on revenue performance, the effectiveness of tax audits varies across different contexts, necessitating tailored approaches. The research concludes that a comprehensive strategy integrating tax education, transparent government spending, and strategic compliance audits is essential for optimizing revenue collection and supporting sustainable economic development in Uganda. Future research should explore the long-term effects of these interventions and consider the role of digitalization and socio-cultural factors in shaping tax compliance behavior.