Effect of Corruption and Governance on Tax Revenue in Mogadishu, Somalia

Tax revenue has become vital for any government to smooth its operation. Therefore, this study attempted to investigate the effects of corruption and governance on tax revenue in Mogadishu. The study used primary data through a questionnaire as the main data collection instrument. Three hundred and ninety-nine (399) questionnaires were distributed to business owners, managers, finance managers/chief accountants, and tax advisors/consultants. The data were analyzed using SPSS software version
20 for descriptive statistics correlation and multiple regression to establish the relationship between independent and dependent variables. The study found that factors like a regulatory burden and lack of political stability play a significant role in the tax revenue of the public sector entities. Moreover, the study revealed that government effectiveness was negatively correlated with tax revenue. The study recommends upgrading tax officers' knowledge of various accounting software programs utilized by taxpayers as this chasm aids illegal traffickers in evading taxes. Finally, the tax office should provide speedy service to consumers regarding tax declaration and payment.