Effect of Tax Invoice Management System on Value Added Tax Compliance Among Restaurants in Thika Town, Kenya

This is proven by KRA’s failure to meet its revenue targets for the last few years. This study sought to establish the effect of the Tax Invoice Management System on value-added tax compliance among restaurants in Thika town, Kenya. The theory that guided the study was technological determinism. The data collected from the questionnaires were analyzed through quantitative data analysis methods. The target population was 1,635 licensed restaurants in Thika. The sample size is 321 firms that are registered for VAT in Thika town. The response rate for the questionnaires issued was 76.0%, with 244 out of 321 participants providing complete responses, while 24.0% did not respond. The study found that the implementation of the Tax Invoice Management System (TIMS) had a positive and significant effect on VAT tax compliance among restaurants in Thika town, Kenya (β = 0.269, p = 0.000). The study recommends that the Government of Kenya strengthen policies supporting the adoption of the Tax Invoice Management System (TIMS) to enhance VAT compliance. Future studies could examine the role of taxpayer attitudes, enforcement mechanisms, and government incentives in shaping VAT compliance behavior.