Surendran Pillay, Adefemi Obalade and Agnes Elson Malima
This study determined the impact of taxpayer perceptions, in the form of the fear of punishment by the Tanzanian Revenue and Government authorities, on the rate of using Electronic Fiscal Devices (EFDs) among small business owners in Tanzania. As a result, the study sample was refined to include 279 small business owners, who are based in Arusha region. The key objectives of the study were to determine the categorical relationship between demographic characteristics and the fear of punishment, as well as to determine the impact of the fear of punishment on the rate of using EFDs. The study used the quantitative approach in addressing the objectives by employing the chi-square, ANOVA and ordinal regression as analytical techniques. Results of the analysis suggested no significant categorical relationship exists between demographic variables (the age, gender, and level of education) and the fear of punishment. Furthermore, the fear of punishment does not impact the rate of EFD use. The study recommends that the Tanzania Revenue Authority should not use age, gender, and level of education to determine the effectiveness of punishment among small business owners. Furthermore, the Tanzania Revenue Authority should not use intimidations as a method to impact compliance.