Assessment on Effectiveness of Tax Administration in Ethiopia: The Case Kolfe Keranio Sub City Administration Revenue Office

Abstract

Tax administration is the identification of tax liability, the assessment of this liability, and the collection, prosecution and penalties imposed on reluctant tax payers. If the tax administration is not effective, it is difficult for the government to collect the required amount of domestic revenue for its activities. Therefore, improving tax administration is quite necessary for developing countries like Ethiopia to improve the domestic tax revenue through voluntary compliance. This study aimed to assesses the effectiveness of tax administration in Kolfe Keranio sub city administration revenue office. The target population of the study included tax payers and employees of the office with 150 tax payers and 75 employees. In order to address the research questions, qualitative and quantitative research approaches were employed. The researcher used both primary and secondary sources of data. In order to get primary information, questionnaire and interview were employed. As important as the primary data, the researcher also collected essential data from secondary sources. Non-probability technique which is convenience sampling was utilized to select sample tax payers and purposive sampling method was used to select sample employees. Data also analyzed on quantitative basis using Pearson’s correlation, multiple linear regression analysis and descriptive statistics Based on the analysis and discussion of the research, it can be concluded that the tax laws, procedures, quality of human, capital and time resources, technological infrastructure, public awareness of tax, and quality of tax report has a significant effect on effectiveness tax administration. It is advisable to provide E filing and E payment system to tax payers that could facilitate filing and paying of taxes by using internet service online. Efforts also have to be made to increase tax revenue by applying continuous follow-up to collect the tax arrears Keywords: Effectiveness, Tax administration, Kolfe Keranio Sub-City DOI: 10.7176/RJFA/11-5-05 Publication date: March 31 st 2020