Farmer’s perceptions on tax payment among large scale cattle farmers In Kiruhura District

Abstract

Despite the efforts to improve tax collection by the Government of Uganda, challenges of tax perceptions among farmers continue to be experienced especially among cattle keepers. The study sought to evaluate the perceptions on agricultural taxation by Ankole cattle breeders’ society in Kiruhura district. It was guided by three research objectives which were; to examine the taxation practices of cattle farmers in Kiruhura district, to examine the perceptions of cattle farmers on taxation in Kiruhura district and establish strategies that can be used to improve taxation perceptions among cattle farmers in Kiruhura district .The study used a cross - sectional survey design with quantitative techniques. The study population included farmer members of Ankole cattle breeders’ society and district local government officers. Data was collected using questionnaires and analysed. In the study, it was revealed that as a tax practice, cattle keepers pay tax on value addition of cattle products, they also pay a lot of taxes on inputs in cattle rearing process; Most farmers do not pay taxes on profit after sale of cattle or products from it. It was also found out that there is no fair and transparent tax evaluation process, most farmers in this community believe that taxes levied on their businesses are not affordable since the allowable deductions are not clearly computed; Most respondents believe that a number of taxes which are levied on farmers are not appropriate since they pay a lot of taxes including URA taxes, license taxes, fees and other levies by the district and other bodies. It was found out that there is double taxation and this greatly affects their perceptions towards paying such taxes. The study findings showed that there is need to put in place effective mechanisms for tax information exchange between farmers and tax people, there is need to avoid more information on the different forms of taxes and how to calculate or compute such taxes which can help in managing challenges faced in the taxation process by farmers. It was therefore concluded that cattle farmers should pay a number of taxes on various activities in the farming process including; value addition on cattle products, inputs and transportation of cattle; Cattle farmers generally have a negative perception towards paying taxes because the tax evaluation process is often not fair. The study recommended that there is need to put in place record keeping measures among farmers in order to help track the amounts they make in a particular period, there is need to avail tax information to all famers and also introduce self-guided assessment tax systems where farmers are able to self-assess themselves in regard to how much they are able to pay.