Taxpayer education enhances compliance

A story is told of a fresh graduate who was shocked by the higher tax deductions on his first payslip compared to those of his colleagues with a similar salary.

He protested to his employer, only to be told that since he resided at the staff quarters the house was considered a benefit, hence subject to additional tax. He was crestfallen.

This heartbreak could have been avoided had the young man been exposed to adequate tax education.

But this was, probably, not the case because the society views tax authorities with apprehension.

Since the biblical times, enforcement has been used as a primary tool for compliance in most tax administrations.

This probably explains why tax collectors are never the favourite public officers within their jurisdictions.

KRA
According to a research study conducted by Griffith University in 2008 titled Enforcing Tax Compliance: To Punish or Persuade?’, adoption of the enforcement over the facilitation model as a compliance driver has several serious shortcomings, the major one being the risk of undermining the relationship between tax authorities and the taxpayers.

In the long-run, trust between the two parties dissipates and, gradually, their relationship borders that of adversaries.

Closer home, the Kenya Revenue Authority (KRA) has for a long time been an enforcement agency in the eyes of the taxpayers.

However, in a bid to establish a better working relationship with the taxpayers anchored on trust, the tax agency has resorted to exploring other measures that promote voluntary compliance among the taxpayers.

Taxpayer education is one such measure.

TAXPAYERS
An old African adage has it that, if you want the best from a tree, tend it while it’s a sapling.

It is for this reason that it is important to also look at the potential future taxpayers.

Through the Schools Outreach and Tax Club programmes established in 2012, KRA has reached out to more than 700 schools across 43 counties.

The idea is to inculcate the right attitude and a positive perception of tax and taxation in the youth.

If this is consistently done and accorded the necessary support, then the future taxpayer will be adequately prepared to fulfil their civil obligation of contributing to the national kitty through taxes when they become of age.

EDUCATION
In 2016, KRA took taxpayer education to the next level.

The University Tax Societies programme — otherwise known as UTax — became an instant success in both public and private universities.

So far, students from 27 universities have been sensitised and proficiently trained to have basic operational knowledge on tax matters through societies run by student membership with minimum support from their institutions.

During the 2016 and 2017 annual tax return filing season, members of the societies were at hand to assist taxpayers file their returns.

CAREER
This has created ambassadors and promoters while a few, after college, have found a niche in assisting others at a fee.

They are also key ambassadors in delivering the tax message to those at the grassroots level.

If one remains a hoarder of information, chances of it effectively reaching the target audience are very slim.

Taking the information to the doorstep of the students also has the potential to shape their career aspirations.

This widens the horizon of students who aspire to become tax experts.

Better knowledge of tax issues can be a better platform of inculcating a tax compliance culture at an early age.

Ms Wandera is the deputy commissioner in charge of marketing and communication at the Kenya Revenue Authority (KRA). [email protected]