Assessing the Effectiveness of Revenue Collection on the Financial Sustainability of Rural Councils: A Case Study of Mwandi Local Authority

Effective revenue collection is vital for the financial sustainability and developmental progress of rural councils. This study focused on the Mwandi Local Authority in Zambia, driven by the need to enhance revenue generation management systems to support local government initiatives and improve service delivery. The rationale behind this research was to establish the challenges faced by rural councils in generating sufficient revenue for developmental projects and ensuring efficient staff performance. The primary objectives of this study were threefold: to determine the effectiveness of local government institutional capacity in revenue collection, to examine the effects of tax evasion on revenue collection in local government revenue collection, and to establish strategies to improve revenue collection in Mwandi Town Council. The descriptive research design was employed in conducted a case study integrating mixed- methods where both qualitative and quantitative analysis of data with key stakeholders was used, these included council staff. This approach provided a comprehensive examination of the revenue collection systems and their impacts on council revenue collection and developmental outcomes thereafter. The results of this study identified key weaknesses in the current revenue generation management system, that local government institutional capacity were poor. Secondly, tax evasion on revenue collection diminished local government intervention. Therefore, proposing plausible recommendations for improvement in rural council revenue collection system, that there is need to review the structural and operational frameworks governing the local council revenue collection, tighten treasury control over rural councils revenue sources, strengthen legislative oversight and the public audit functions, plug loose areas in income tax frameworks, instituting transparency in national revenue remittance processes as well as delinking of the political arm in public administration. The implications of this research are significant, contributing to a better understanding of how effective revenue collection can enhance the financial health and developmental capacity of rural areas within council’s realm.