The effectiveness of EFRIS on tax compliance

Abstract

The Uganda Revenue Authority, in a quest to enable compliance and improve VAT reporting of commercial transactions, introduced the Electronic Fiscal Receipting and Invoicing System (EFRIS). However, despite the implementation of EFRIS, tax compliance levels have still remained low. This study attempted to examine the effectiveness of EFRIS on tax compliance in Uganda. The objectives of the study were to assess the ease with which EFRIS is used among taxpayers, to examine the factors affecting the use of the EFRIS and to establish strategies to adapt in order to improve the implementation of EFRIS. A cross sectional survey design was adopted, and quantitative data was collected with aid of structured self-administered questionnaires from a sample of 242 staff in the domestic taxes department at the URA Headquarters using the simple random sampling. Of these, 194 questionnaires were usable, giving an 80% response rate. Thereafter, data collected was captured and analyzed for descriptive statistics using SPSS. The findings of the study revealed that more accurate tax returns are being filed, refund claims using e-receipts or e-invoices are being tracked faster after the introduction of EFRIS, and that URA support is always available to assist taxpayers with EFRIS difficulties. However, the taxpayers’ accounting systems have not been easily integrated with the system and not all taxpayers have a positive attitude towards EFRIS partly because they do not have the knowledge, resources and technology necessary to use EFRIS. The study recommends that URA puts in place strategies such as continued sensitization of taxpayers on the application and the benefits of EFRIS in order for them to have a better attitude towards the system, upgrading EFRIS to make it more user friendly for all the taxpayers as well as ensuring that all the taxpayers have the resources necessary for them to use EFRIS.