Plate 9.5: Gas Welders Working along Madzindadzi Road
7.2 Lead−in Summary of Responses
A brief of manufacturer’s responses to the six key questions, on a 1 to 5 scale, is briefed in Figure 7.1. Overall, a whopping 90% of the manufacturers concluded that they must be consulted, where possible, in the growth of that tax strategy. This is essential since the manufacturers own a buy−in in the tax strategy they can embrace it. Participation in decision making can be equated to the idea of inclusivity in which stakeholder interact to find working resolutions to fund city development through an operative taxation policy (Chirisa, 2012;
2013). If the manufacturers have a feeling that they are distanced from crafting policies that affect their day−to−day operations they are probably going to resist initiatives of that nature.
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Their resistance can take different forms, some which are difficult to enforce (Kanbur, 2009;
Keen and Kanbur, 2015).
Figure 7.1: Collective Responses to the Proposed Tax Measure (Study Findings, 2017)
In as much as a significant percentage of manufacturers are calling for inclusivity in designing tax strategies, a huge chunk of them (68%) perceive taxation as a needless liability to their businesses. This partly explains why they are keen to participate so that perhaps they negotiate for a tax policy that dilutes the burden on their operations. Just 32% of the manufacturing believes that taxation is a fair initiative for sustainability of their business operations. Since 90% manufacturers are keen to be involved in designing tax strategies, relevant authorities should take the chance of such platforms to sell the notion of taxation to people who perceive it as an unnecessary burden. As such, receiving mass support is a key to winning the hearts of manufacturers.
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Approximately, 50% of manufacturers have an appreciation of the motives why tax is collected from citizens and business operators. They demonstrated that they have knowledge that tax is used in the providence of civic and quality goods such as roads, water, street lights, and public libraries. To those without this knowledge, tax education is essential in selling the proposal to levy the informal trade sector.
Apart from the guided questions, manufacturers where given the room to air out their views on the notion of collecting tax from them. Responses drawn from unrestricted questions were analysed using sentimental analysis as discussed in Section 3.7.1, and the outcomes of all the three sites is displayed in Figure 3.5. From the analysis of the words in Figure 3.5, it can be assumed that manufacturers will pay tax to the government if taxation will bring about better service provision, particularly provision of waste collection bins and waste collection. Study findings showed that government is making tangible strides in taking maintenance of the environment. On the first day of the survey, there was switch of sampling windows because the government, through its agent, EMA2, was collecting waste from the Complex (Plate 3.1 in Section 3.11.1). Waste collection must not be a once off thing when large volumes of waste have accumulated, but a routine activity. Making it a routine activity will justify the need for tax collection.
Among the issues raised by some manufacturers, money collected through tax must be gainfully used to give them with access to loans, key raw supplies and removal of magombiro (touts) who provide intermediary activities. These are among issues to be negotiated when stakeholders meet to discuss about the proposal to tax the informal trade sector. The willingness of manufacturers to be involved in stakeholder meetings is a complementary gesture to the government’s initiative. This discovery is backed by one scholar, who argued that informality
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is a negotiated process, implying that taxing it must also be regarded a negotiated process and not an imposed event (Villamizar−Duarte, 2015). Adopting this perspective will help in informing theory, policy and practice.
Following some uncoordinated responses, an inquiry was made into whether the responses are independent of the queries asked. A chi−square independence of association test was conducted for all the study sites at 0.05 level of significance using 5×5 contingency table with 16 degrees of freedom. This combination prescribed a chi−square threshold of 26.30. The intention of the inquiry was to examine the hypothesis that:
Manufacturers’ views on the suggested tax measure are independent of questions asked.
Table 7.1 summarises the perceived and probable cell totals, and chi−square values for individual combinations. For this test, a calculated chi−square value of 372.7293 is way above the threshold of 26.30 meaning that manufacturers’ responses rely on the questions asked. It can then be assumed that the responses by manufacturers differ between questions. Some questions were testing on the attitude, some knowledge and some perceptions of manufacturers to the proposal to tax the informal trade sector. Tax education is essential where there exists a negative attitude and perception about taxation, and where there is general lack of information on taxation. It is critical to observe that Table 7.1 shows the observed cell totals, (the expected cell totals) and [the chi−square statistic for each cell].
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Table 7.1: Question−Response Independence of Association Test (Study Findings, 2017)
Scenario Presented to Manufacturers
Strongly Agree
Agree Neutral Disagree Strongly Disagree
Row Total Tax collection from your
income improves the working space
136 (157.53)
[2.94]
181 (230.74) [10.720]
72 (83.08)
[1.48]
176 (136.75)
[11.26]
76 (32.90) [56.45]
641
Public and quality goods are financed using tax payers’
money
114 (157.77)
[12.14]
282 (231.10 [11.21])
102 (83.21)
[4.24]
125 (136.97)
[1.05]
19 (32.95)
[5.91]
642
Tax measure places unfair burden on industry
247 (135.41)
[91.97]
121 (198.34)
[30.16]
49 (71.42)
[7.04]
111 (117.55)
[0.37]
23 (28.28)
[0.99]
551
Tax is valuable for its own good
77 (157.77)
[41.35]
331 (231.10)
[43.19]
112 (83.21)
[9.96]
106 (136.97)
[7.00]
16 (32.95)
[8.72]
642
A fair business environment is tax free
192 (157.53)
[7.54]
207 (230.74)
[2.44]
69 (83.08)
[2.39]
147 (136.75)
[0.77]
26 (32.90)
[1.45]
641
Column total 766 1122 404 665 160 3117
From Table 7.1, 136 and 181 observed totals strongly agreed that if tax is collected from their income, their working environment will improve. On the same note, 114 and 282 observed totals respectively strongly agreed that civic and merit goods are financed using money collected from tax money. This is a true image that a substantial percentage of manufacturers have perfect knowledge about the significance of taxation. However, 247 and 121 observed totals strongly agreed and agreed respectively that taxation places an unfair burden on their operations. This negative view towards tax is against their knowledge about it (tax). One respondent from Siyaso home industry explained that the spirit and purpose of taxation is noble, but its mal−administration is the chief reason why they perceive as it a needless liability to them. This is a sure sign that if government pledges commitment to use the finances collected through tax to intended purpose, manufacturers will back the initiative. Is this observed reality true for different locations and gender orientations?
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