ASSESSMENTS OF SMALL AND MEDIUM TAXPAYER’S PERCEPTION ON ADOPTION OF ELECTRONIC FISCAL DEVICES: A CASE OF ILALA TAX REGION

Abstract

ABSTRACT This study explores the perceptions of small and medium taxpayers (SMTs) regarding the adoption of Electronic Fiscal Devices (EFDs) in the Ilala Tax Region, aimed to understand how these perceptions impact compliance and efficiency in tax collection. The study examined the benefits and challenges allied with EFD adoption, emphasizing the factors that influence usage among taxpayers. EFDs are essential tools that facilitate accurate record-keeping and reporting, contributing to the overall effectiveness of tax administration. However, many SMTs in the Ilala Tax Region experience confusion and uncertainty about EFD implementation, which hinders their ability to comply with tax regulations effectively. This research identified the strengths and weaknesses in taxpayer understanding of EFDs and their functionality. Data for this study was collected using structured questionnaires distributed to a sample of 100 SMTs, selected using Yamane’s formula for optimal sampling size. Moreover, data collected were analyzed using descriptive statistics, chi-square tests, and binary logistic regression to explore awareness, perceived usefulness, ease of use, durability, benefits, risks, and demographic influences on adoption. Findings revealed that perceived usefulness, ease of use, and durability positively influenced adoption, while perceived risk negatively affected taxpayers’ behavioral intentions, and demographic characteristics such as age, gender, business type, and experience shaped awareness and adoption patterns. The study concluded that EFD adoption is determined by both technological perceptions and individual characteristics, emphasizing the importance of promoting usability, reliability, and security. Recommendations included enhancing user training, providing continuous technical support, raising awareness campaigns, and designing durable devices to increase adoption rates, ultimately improving compliance and business record accuracy.