Abstract:
The overall objective of the study was to assess the effects of taxpayer’s education on
tax compliance among the SMEs in Moshi Municipality, Tanzania. The study
specifically aimed to examine taxpayer’s education level among the SMEs, determine
the means of acquiring tax education, and examine the number of SMEs which
comply to pay tax in Moshi Municipality. The study adopted descriptive research
design and data was corrected once at a time. The sample size of the study was 121
respondents. Stratified sampling procedure was used to obtain the respondents. Data
was collected using a questionnaire and were analysed using descriptive statistics of
which frequency and percentage was computed and Pearson Correlation coefficient to
determine the relationship between variables. The study found that SMEs owners
lacks tax education which enhance low tax compliance behaviour, the study went
further and found that methods used by Tanzania Revenue Authority (TRA) to
increase tax compliance behaviour among SMEs is ineffective, lastly the study
revealed that there is a positive relationship (r = 0.725) between taxpayers’ education
and compliance behaviour. Basing on the research findings the study concludes that
Taxpayer education is essential in improving voluntary tax compliance behaviour. It’s
essential for the taxpayers to understand his/her rights, obligations, and the
procedures of paying taxes. The study recommends that taxation education should be
taught at all levels of education, with an emphasis of promoting voluntary tax
compliance behaviour to individuals in the country.
