Relationship between local government hotel tax and service delivery in Uganda a case study of Kawempe division
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The study focused on the relationship between local government hotel tax and service delivery in Uganda, taking a case study of Kawempe division. This study was guided by the following specific objectives; to assess the contribution of the local government Hotel Tax on service delivery in Uganda, to examine the relationship between the Local Government Hotel Tax and security lights, to examine the relationship between the Local Government Hotel Tax and garbage collection, to examine the relationship between the Local Government Hotel Tax and road maintenance, to assess the challenges faced in revenue collection of the Local Government Hotel Tax. The methodology entailed adoption of a mixed methods research approach. The sample targeted by the survey consisted of 73 respondents, who had been selected using the Cochran‟s formula of sample size determination, and the data obtained were summarized into percentages. The data collection tool employed by the study was a structured questionnaire. The questionnaire response rate realized was 74.6%, implying a zero non-response bias. 53 questionnaires were duly completed and returned for analysis i.e. 8 respondents from KCCA and 45 respondents from hotels. The Study used the Multivariate Regression Analysis to assess the relationship between the Local Government Hotel Tax (LGHT) and service delivery in Kawempe division. The key independent variables used were; road maintenance, garbage collection and security lights, with hotel tax as the dependent variable. The overall model explained 13.3% of the variance in hotel tax, which was revealed to be statistically significant, F (3,49) = 11.092, p < .005. An inspection of individual predictors revealed that road maintenance (Beta = .259, p < .005) and security lights (Beta = .521, p < .005) are significant predictors of hotel tax. This means that higher levels of road maintenance and security lights are associated with higher levels of hotel tax. However, garbage collection was found to be insignificant (Beta = -.053, p > .005) at 5% level of significance. During the study, it was discovered that the challenges that the enforcement team faced the most during the collection of the Local Government Hotel Tax were; limited resources and skills among the enforcement officers, and corruption and embezzlement among revenue enforcement officials. The study recommends that KCCA should play a leading role in providing resources for the training of tax enforcement staff in the utilization of the ICT systems used in mobilizing the Local Government Hotel Tax revenue, thereby avoiding corruption and enhancing transparency in the tax collection process.