Determinants of Property Tax Payment Compliance among Households using Manual Systems in Rural Areas of Mbeya Region, Tanzania

Abstract

This study examined the determinants of property tax payment compliance among households that pay manually in rural areas of Mbeya Region, with a focus on assessing the influence of socio-economic factors and evaluating the role of taxpayers’ attitudes and perceptions in shaping compliance behavior. The study adopted a cross-sectional research design and was conducted in three rural districts, namely Mbarali District, Chunya District, and Kyela District. A sample of 384 households was selected using a multistage sampling technique, and data were collected through structured questionnaires administered to household heads or responsible taxpayers. Descriptive and inferential statistical methods were used for data analysis, including the application of an ordinal logistic regression model to examine the relationship between independent variables and compliance status. The findings revealed that property tax compliance in the study area is generally low, with a large proportion of respondents falling into the low compliance category. Socio-economic factors such as income, education, occupation, age, and property ownership status were found to significantly influence compliance behavior. In addition, taxpayers’ attitudes and perceptions toward property tax were found to have a strong and positive effect on compliance, indicating that behavioral factors play a critical role alongside economic conditions. The study concludes that property tax compliance in rural areas is influenced by both socio-economic capacity and taxpayers’ perceptions, and that improving compliance requires a comprehensive approach that addresses both dimensions. The study recommends enhancing taxpayer education, improving transparency and service delivery, simplifying tax payment systems, and strengthening enforcement mechanisms. These measures are essential for improving property tax compliance and enhancing local government revenue mobilization in Tanzania