Abstract

The study aimed at assessing the impact of taxpayer education on VAT compliance among Hotels in Kisumu County. Specifically, the study sought to determine the effect of print media axpayer education, electronic taxpayer education and taxpayer sensitization programs on VAT compliance. This study was guided by three theories namely: The Fiscal Psychology Theory, the Economic Deterrence Theory and the Ability to Pay Theory. The study adopted a descriptive research design. A total of 250 hotels operating in Kisumu County were targeted. Stratified random sampling was used to select 153 hotels. The study gathered primary data with the help of questionnaires. Data collected was analyzed using Statistical Package for Social Sciences (SPSS) and the study findings presented in the form of tables and figures. The findings would reveal whether taxpayer awareness, taxpayer perception, attitude, and imposition of fines and penalties have a significant effect on VAT compliance. Based on correlation beta coefficients, the study established that taxpayer sensitization programs (β=.455) had largest effect on VAT compliance followed by electronic taxpayer education (β=.124) and lastly print media taxpayer education (β=.102). The study concluded that taxpayer education had significant effect on VAT compliance. The study recommends that the Kenya Revenue Authority should   invest more in tax sensitization programs like forums, seminars and this may be misplaced given that the focus of this study is taxpayer education, furthermore this suggestion requires legal authorization for KRA to implement with least emphasis on print media channels.  The policy makers at Kenya Revenue Authority in designing taxpayer education programs should focus more on enhancing the existing taxpayer sensitization programs and e-taxpayer’s education channels since this would greatly enhance VAT compliance.