A survey of revenue enhancement strategies by local authorities in Kenya
Njoroge, Kariuki J
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Local authorities in Kenya could be good focus for grass root democracy and basic focus of economic development. Its place therefore in the economic and legal framework should be such that allows them to play fundamental role in the county's governance and growth. Deterioration of services delivered by local authorities in Kenya is evident though lack of financial resources is normally the excuse given by many local authorities. Whereas local authorities in Kenya are less able to raise revenues and lack adequate access to elastic, stable and robust revenue sources, such as sales, value added tax and income tax, there is also evidence of low performance in revenue collection and inefficient spending practices by many local authorities thus undermining efforts towards better service delivery . This research is set to find out: what revenue enhancement strategies are local authorities in Kenya adopting to enhance their local revenue sources in order to ensure sustained delivery of services to the local community and the factors they perceive to affect their revenue mobilization effort. To answer this research question, primary data was collected from 34 local authorities that responded to the 50 questionnaires that were dispatched. The findings were analysed using descriptive statistics and factor analysis. The findings of this study led to the conclusions that: there exists high potential for local authorities to collect more locally generated revenues only that the revenue enhancement strategies chosen are applied at low scale implying low performance in revenue collection. However, many factors were identified that are perceived by local authorities to influence their effort towards improved revenue generation e.g. political interference in tax collection. Also the findings revealed that although different local authorities suffer in different ways, they use similar strategies of ,revenue enhancement but at different levels. The factors that are perceived to influence revenue collection effort are also similar but the scale of effect varies from one local authority to another.