The Effect of Tax Reforms on the Efficiency of Revenue Collection in Kenya

Abstract

The objective of this study was to establish the effects of tax reforms on the efficiency of tax revenue in Kenya. This involved collecting data from various government and nongovernmental agencies i.e. Kenya Revenue Authority, Kenya National Bureau of Statistics, Transparency International, World Bank, International Monetary Fund. This data was collected for a period of 38 years beginning 1980 and ending 2017.The collected data was analyzed using SPSS version 20 and the following was established; there’s a strong relationship between GDP and tax revenue as well as the relationship between inflation and tax revenue. However, there’s no significant relationship between corruption and tax revenue as well as between tax evasion and tax revenue. The study concludes that in Kenya tax reforms have a significant and positive influence on the tax revenues. This therefore means that, over time, with the various reforms being instituted they will lead to an increase in tax revenues. However, further studies are required to determine why there is no substantial increase in tax revenues despite the various positive tax reforms.