Abstract:
Revenue collection in counties in Kenya is a crucial aspect of their financial
management and governance. Most of Kenyan County governments grapple with
revenue challenges, facing difficulties in generating sufficient funds for essential
services and development initiatives. The purpose of this study was to establish factors
influencing revenue collection in county governments, specifically focusing on Kitui
County. Specific objectives included; to establish the effect of technological
innovation, employees’ competence and legal framework on revenue collection in Kitui
County, Kenya. This study was anchored on Optimal taxation theory, Technology
Acceptance model, and Subsidiary Theory of Taxation. The study employed an
explanatory research design and involved340 employees of Kitui County government
as target population. The study adopted stratified random sampling and purposive
sampling techniques and further, the Krejcie and Morgan table (t table) was used to
give an ideal sample size of 181. The researcher obtained data from primary sources
using self-administered questionnaires. Both descriptive and inferential analysis was
carried out with the help of the SPSS software. The study adopted regression analysis
to confirm the influence of study factors on revenue Collection in Kitui County. The
findings revealed that the predictors (technological innovation, employee competence
and legal frameworks) collectively contribute to 37.5% prediction of the revenue
collection at the County. Specifically, one-unit positive change in technology
innovation, influences revenue collection by 0.350(35.0%); a unit increase in employee
competency is associated with an estimated increase of 0.084 (8.4%) in the revenue
collection at the County and a unit increase in legal frameworks is associated with an
estimated increase of only 0.026 (2.6%) improvement in revenue collection at the
County. Hypotheses testing revealed that technological innovation and legal framework
have a significant influence on revenue collection in Kitui Government, Kenya, (p-
value=0.000<0.05) and (p-value=0.014<0.05) respectively. However, employees'
competence was found not to have any significance effect on revenue collection in this
context (p-value=0.290>0.05). The findings underscored the significant contributions
of technological innovation and a well-structured legal framework in predicting
revenue collection outcomes, highlighting their importance in the County's fiscal
strategy. These results have practical implications, suggesting that investments in
technology and legal reforms should be prioritized by the County government to
optimize revenue generation. The study recommended that he County government
continues to invest in advanced technological solutions, prioritize continuous training
programs for its workforce and enhance policies, rules, and regulations governing
revenue collection at the County