Automation activities, capacity building and revenue collection performance at Kenya Revenue Authority

Abstract

The Kenya Revenue Authority has over the years failed to meet its revenue collection target. This has been associated with the systems that are still operating manually in the tax collection process. This study's general objective was examining the role of automation activities and capacity building on revenue collection performance in the Kenya Revenue Authority. The specific objectives were: to examine the role of process automation on performance in revenue collection performance at KRA; to assess the role of capacity building on the collection of revenue at KRA; and to determine the moderating effect of capacity building on the relationship between Process automation and revenue collection performance. The research was guided by the theory of public expenditure, technological determinism, and social determinism. Explanatory research design was employed. A sample of 384 employees working in the department of Domestic Taxes and Customs and Border Control Department were selected using a systematic sampling technique from a target population of 4108 employees working in the two departments. Questionnaires were used to collect primary data. Descriptive and inferential statistics were employed in data analysis. Descriptive statistics included means and standard deviations to describe the characteristics of the variables. Inferential statistics included correlation and regression analysis, which tested the relationship between variables. The study adopted Hierarchical regression model. The findings indicate that process automation (β = .618, p = 0.000, R2.441, ΔR2.374) and capacity building (β = .374, p= 0.000, R2.540, ΔR2.099) significantly influence revenue collection performance. In addition, capacity building moderates the relationship between process automation and revenue collection performance (β= -.098, p = 0.034, R2.547, ΔR2.006). This information provides practical solutions on process automation to KRA management as results of the study have shown a positive notable effect of process automation on revenue collection performance and therefore the management should ensure that the systems are improved continuously so as to match with the current technological situation. The study also provides practical solution on capacity building to KRA management, findings have shown a positive significant effect of capacity building on revenue collection performance and therefore the management should invest more in building capacity of its staff. KRA policy makers should develop policies on training programs such as ITAX, ICMS, and EGMS to enhance employee performance and improve their productivity.