Digital Tax Filing and Revenue Collection among County Governments under the Lake Region Economic Bloc

Abstract

Purpose: The purpose of the study was to determine the effect of digital financial services on revenue collection among county governments under the Lake Region Economic Bloc (LREB) in Kenya.

Material/methods: The study was anchored on the diffusion of innovations theory and the theory of planned behavior. An explanatory research design was adopted, targeting 267 top and middle-level employees from 14 county governments under LREB. Stratified and simple random sampling techniques were used to sample 159 employees. Structured questionnaires were utilized for data collection. Content validity was used to ensure validity, while Cronbach's Alpha coefficient ensured reliability. Data analysis involved descriptive statistics (means, standard deviations, frequencies, and percentages) and inferential statistics (Pearson correlation and multiple regression analysis) for hypothesis testing.

Findings: The findings indicated that digital payment significantly enhances revenue collection among county governments. However, digital accounting was found to have an insignificant effect on revenue collection.

Conclusion: The study concludes that while digital payment is crucial for improving revenue collection, the effectiveness of digital accounting requires further evaluation.

Value: The study recommends that county governments should evaluate their digital accounting systems to improve their functionality and efficiency. Additionally, providing advanced training to employees on these systems is essential to maximize their potential.