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The Impact Of Government Policy On Tax Evasion. A Case Study Of Nakawa Market In Kampala Region
The study examined the relationship between government tax policies and the prevalence of tax evasion among business operators. This
research explores how policy design, implementation, and enforcement influence compliance behavior, focusing specifically on Nakawa
Market, a bustling commercial hub in Kampala. A cross-sectional survey design was adopted, employing both qualitative and quantitative
research methods. Data was collected from 212 respondents, comprising URA, VAT officers and business operators, using structured
questionnaires, interviews, and document reviews. The data analysis involved statistical techniques such as descriptive statistics, Pearson
correlation, and multiple regression to establish relationships between variables, supplemented by thematic analysis for qualitative data. The
findings revealed that 75% of respondents perceive government tax policies as either effective or very effective, citing efforts to streamline
compliance processes. However, challenges such as high tax rates, complex filing procedures, and limited taxpayer awareness were
highlighted as significant barriers. Business operators called for enhanced tax education programs, simplified procedures, and reduced rates
to encourage compliance and minimize evasion. The study concludes that while government policies have made strides in addressing tax
evasion, further reforms are necessary to achieve optimal compliance levels. Recommendations include policy simplification, targeted
education campaigns, and the adoption of technology to modernize tax administration. This research contributes to the broader
understanding of tax compliance dynamics in urban markets, offering insights for policymakers to design more effective and inclusive tax
systems. Future research is encouraged to extend these finding
Keywords: Government Policy, Tax Evasion, URA, VAT officers and business operators