Thesis:

Analysis of online tax filing and tax compliance among Small and medium enterprises in Kitale town, Trans-Nzoia County, Kenya

Submitting tax forms and accompanying documentation electronically through a website, paper copies are usually not needed. The main objectives of this research are as follows: first, to assess the tax rate structure; second, to examine the opinions of SMEs; third, to examine the availability of tax data; and fourth, to investigate the extent to which the SME community in Kitale town, Trans-Nzoia, Kenya has been significantly affected. This study examined the effect of online tax payment on tax compliance using the Theory of Planned Behavior and the Technology Acceptance Model as conceptual frameworks. Particular focus was placed on small-scale firms in the area surrounding Kitale Town as the primary focus of the study. There were around 289 small businesses in the area, according to the information provided by Kitale Town. Some of the fields in which these companies operate include healthcare, education, agriculture, transportation, communication, wholesale and retail trade, food and lodging, banking and insurance, and transportation. Whatever the case may be, we shall press on with carrying out the descriptive study. In order to make data collecting easier, 289 people were recruited to take part in the study. The study, which employed the Yamane formula, drew 167 participants. Every one of these people runs a small or medium-sized business in Kitale Town. Using a non-probability sampling technique, 167 participants were purposively picked. A semi-structured questionnaire with both closed-and open-ended questions were used to identify the main data that needs to be collected. In order to determine the level of internal consistency, the researcher used the statistical metric Cronbach's Alpha (α). The value is calculated using SPSS, a tool for data analysis. We not only sent out emails to other participants, but we also managed the drop-and-pick method of survey execution. The tables' data was analyzed using descriptive statistics and SPSS 29.0, the Statistical Package for the Social Sciences. A tabular structure was used to convey the material, with a focus on the investigation's findings and outcomes. Descriptive statistics was made accessible as soon as the data analysis is finished. The study also established that SMEs' attitudes toward taxation affect compliance, with many businesses perceiving the tax system as unfair or burdensome, which discourages voluntary compliance, high tax rates were identified as a major obstacle to tax compliance, as they increase financial strain on SMEs and lead to tax avoidance behaviors. Respondents strongly agreed that reducing tax rates would enhance compliance. Compliance costs also emerged as a critical factor, with SMEs incurring substantial expenses in meeting tax obligations, including hiring professionals and maintaining tax-related records. Reducing these costs was found to improve compliance levels. The study concluded that enhancing tax information accessibility, fostering positive taxpayer attitudes, lowering tax rates, and minimizing compliance costs could improve tax compliance among SMEs. It recommended that the government simplify tax structures, improve transparency, and leverage digital tax systems to reduce compliance costs. Further studies were suggested on digital tax platforms, tax incentives, and comparative compliance analysis between SMEs and larger enterprises.