A study of the effect of Mobile Money Services on Tax Compliance in zambia: A case of MFEZ and CBD Lusaka

Abstract

The aim of this study was to assess the effect of mobile money services on tax compliance in Zambia, in the case of the Multi-Facility Economic Zone (MFEZ) and Central Business District (CBD) of Lusaka. The study objectives were first to establish the extent to which mobile money is used to pay tax to the Zambia Revenue Authority (ZRA) in Zambia. Secondly, it aimed to find out the challenges of using mobile money for tax compliance in Zambia and, lastly, explore potential measures and strategies that could be implemented to harness the potential of mobile money in augmenting tax compliance. Drawing upon both quantitative and qualitative research methodologies, this study employed surveys, interviews, and data analysis techniques to elucidate the intricate dynamics at play. Through rigorous data collection and analysis, the research aimed to provide insights into the utilization patterns, benefits, and challenges associated with mobile money in tax compliance. The findings of this study were expected to contribute significantly to the existing body of knowledge concerning mobile money adoption and its implications for tax compliance in developing economies. By shedding light on the specific nuances of the Zambian context, this research endeavored to offer actionable recommendations aimed at fostering an environment conducive to leveraging mobile money for enhanced tax compliance. From a broader perspective, this thesis aspires to not only deepen academic understanding but also offer practical implications for policymakers, tax authorities, financial institutions, and mobile money service providers in Zambia and beyond. The study established that, to a good extent, mobile money is used by taxpayers to pay presumption tax. It was also established in the study that mobile money can reduce the prevalence of cash transactions and can provide a digital trail of transactions, making it easier for governments to track and collect taxes. Using mobile money can also improve tax compliance.