REVENUE COLLECTION SYSTEMS AND REVENUE PERFORMANCE BY NAIROBI CITY COUNTY, KENYA
REVENUE COLLECTION SYSTEMS AND REVENUE PERFORMANCE BY NAIROBI CITY COUNTY, KENYA
Peter Ochieng Bando - Postgraduate Student, Department of Accounting and Finance, Kenyatta University, Kenya
Dr. Charity Njoka - Lecturer, Department of Accounting and Finance, Kenyatta University, Kenya
ABSTRACT
Efficient revenue collection is crucial for the functioning of decentralized governance systems, which need sufficient resources. Currently, county governments rely on the national government for a disbursement of audited national revenue from the previous year to manage devolved functions and local projects. This supplements the county governments' ability to generate their own revenue. This over-reliance on national transfers coupled with inefficiencies in its collection systems impedes Nairobi County’s own source resource efforts. This research focused on the effectiveness of revenue collection systems on revenue performance in Nairobi City County, specifically focusing on automated, manual, and banking systems. The study drew on four theories: Optimal theory of taxation; Endogenous Growth theory; Revenue Diversification theory; and Theory of Performance. The research employed both causal research design and descriptive survey research design to realize the research’s objectives. A structured questionnaire was administered to selected respondents. Quantitative data was analysed with assistance of SPSS software, and data presented through tables, charts, and graphs. The research established that automated revenue systems significantly influenced revenue performance. Secondly, the study indicated that manual revenue systems significantly influenced revenue performance. Further, the research found that banking revenue systems have a positive and significant effect on revenue performance. The research recommends that the county should institute robust systems that enhance efficiency in revenue collection and revenue performance. The county must ensure the diversification of its revenue sources to expand its tax and revenue base. Moreover, the county government must institute innovative and dependable systems of revenue collection. Lastly, the research recommends that the county enforce the adoption of ICT in various activities and process of revenue collection to get rid of inefficiencies.
