ASSESSMENTS OF THE PRACTICE OF TAX COMPLIANCE THE CASE OF CATEGORY “B” TAXPAYERS IN BUTAJIRA TOWN

Abstract

Tax Compliance becomes major discussion issues in the financial institutions. However, the tax administration office is unable to collect sufficient amount of taxes from the taxpayers, the government does not achieve its goal and the community dissatisfied with the services of the state. The study is Assessments of The Practice of Tax Compliance the case of Category “B” Tax Payers inButajira Town with the objectives to assess the Roles of tax compliance determinant variables on tax payers behavior to complying tax, to determinant factors influencing taxpayers’ to comply or no to comply for their tax and to determine the relationship between tax compliance determinants with tax payers level of tax compliance. A sample size of 328 was drawn from the tax population in Butajira me dium taxpayers /”B” level taxpayers by using simple random/ lottery method and purposive sampling for revenue office employees. Generally, the research signifies that the factors which make taxpayers not discharge their tax duties with their own and right amount. The study design is descriptive research approach and the study employed quantitative re search methods byusing Stratified and simple random sampling technique and question naires were distributed and collected from primary sources. Then the data was analyzed using descriptive statistics technique and frequency table by using SPSS software. The revenue office has good serious enforcement practice and uses suitable penalty tools and techniques including follow-up and tax audit. However, the studyhas found that the tax payer’s compliance assessed mainly are tax education, attitude towards taxation, percept tion of fairness/equity, social and natural norms, the strength of the tax authority, and perception of government spending were found to be the factors affecting taxpayers’ compliance. Finally, based on the findings possible recommendations include, maintain ing tax fairness and equity, building capacity of the tax authority, conducting extensive awareness creation programs, and providing social services to the general public. Spe civically, attitude plays avital role in shaping the perceptions of taxpayers towards achieving compliance. Besides this, strengthening effective and efficiency of government in tax systems and procedures in tax administration function is also crucial.