Abstract

This study investigates the relationship between human resource (HR) reporting and tax performance among Savings and Credit Cooperative Organizations (SACCOs) in Kenya. HR reporting encompasses the disclosure of workforce-related practices such as employee training, diversity, remuneration, and workplace safety. It is expected to enhance tax performance by promoting compliance with labor-related tax regulations and facilitating access to government incentives. Using a descriptive and correlational research design, the study analyzed secondary data from 40 SACCOs with consistent financial and HR reporting records between 2019 and 2023. Data were sourced from financial statements and sustainability reports, with tax performance measured using indicators such as tax expense and effective tax rate (ETR). Panel regression analysis was conducted while controlling for firm size, profitability, and leverage. The results indicate that HR reporting particularly in employee training, remuneration, and workplace safety has a significant positive effect on tax performance. The findings suggest that SACCOs with more transparent HR disclosures are better positioned to achieve favorable tax outcomes. Additionally, firm-level characteristics moderated these relationships. This study contributes to the understanding of HR transparency as a driver of tax compliance and provides practical recommendations for SACCOs to enhance their reporting practices in alignment with regulatory expectations.

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