DETERMINANTS OF REVENUE GENERATION IN COUNTY GOVERNMENTS IN KENYA; A CASE OF BUSIA COUNTY GOVERNMENT

Abstract

This study investigated the influence automation of revenue collection, revenue mapping, financial partnerships and revenue legislation on revenue generation in Busia county government, Kenya. The study was based on rational Expectations theory of technology adoption, Optimal taxation theory and Sequential theory of decentralization. The study used descriptive research design and targeted a population of 103 staff in the county government of Busia who had direct or indirect role in revenue collection and cash management from where a sample size of 82 respondents was drawn using Taro Yamane’s proportional sampling technique formula. Structured questionnaires were used to collect primary data and piloting of the research instrument was done in Bungoma county government so as to ensure content validity and a Cronbach’s alpha which tests internal consistency checked instrument reliability. SPSS version 24 software was used to compute statistical data; whereby collected data was cleaned, coded and transformed to allow regression analysis. Descriptive analysis such as frequencies, means, standard deviation was used to summarize data into meaningful form; whereas inferential statistics assessed the nature and strength of the correlations, direct and multiple relationships. Analyzed data was presented in tables and graphs. A total of 79 respondents out of the sampled 82 respondents returned completely filled questionnaires representing a response rate of 96.34%, thus good for generalizability of research findings to a wider population. Both descriptive and inferential statistics showed that all independent variables (automated revenue collections, revenue mapping, financial partnerships and revenue legislations) significantly influence revenue generation in Busia county government. The study concluded that; automation of revenue collection significantly improves revenue generation in county governments since the automated revenue systems minimize financial embezzlements associated with manual revenue collections, revenue mapping initiatives assist county governments identify all sources of county revenues thus boosts revenue generation in county governments. The study recommended that, county governments should purely implement automated revenue collection systems so as to minimize financial fraud related cases that are associated with manual revenue collections, county governments should engage in viable revenue mapping initiatives that help in identification of pertinent sources of county revenues. Key Words: Revenue Collection, Revenue Mapping, Financial Partnerships, Revenue Legislation, Automation CITATION: Sechero H., & Otinga, H. N. (2020). Determinants of revenue generation in county governments in Kenya; A case Of Busia County Government. The Strategic Journal of Business & Change Management, 7(1), 357 – 375.