Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers

Dereje Birhanie Jemberie

doi:doi:10.11648/j.ijefm.20200803.11

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Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers

Dereje Birhanie Jemberie

Published in International Journal of Economics, Finance and Management Sciences (Volume 8, Issue 3)

Received: 24 March 2020 Accepted: 28 April 2020 Published: 3 June 2020

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Abstract

This study is designed to investigate the determinants of tax compliance in a case of category “C” business profit taxpayers in Nekemte town. To achieve the designed objectives the study employed a quantitative approach. Necessary data for the study were gathered via questionnaire and reviewing necessary documents. To do this the researcher took out 346 samples from the total 2580 population size of category “c” taxpayers and analyzed the returned 240 questions. The sample size of the study was determined by using simple random sampling technique. Responses of respondents were presented by using the data presentation tools and analyzed via STATA 10 software application and descriptive analytical methods using tables and charts. The study found that, family size and length of tax payment period has a significant negative influence on tax compliance. On the other hand, tax knowledge and awareness and tax penalty and fines has a significant positive influence over the level of tax compliance. The assessed amount of tax, probability of auditing and attitudes towards equity and fairness are insignificant factors in determining the compliance behavior of taxpayer. Finally the researcher recommended that different job opportunities and incentives should be provided by the authorized body to increase earning of large size family members. ERCA should be follow up taxpayers and control their activities to easily prevent evasion by taxpayers; and sufficient and adequate training, awareness creation and education should be offered to taxpayers to enhance their knowledge regarding to tax. Besides ERCA should take measures and penalties on those taxpayers who are not willing to pay their tax liability within a specified time period for the purpose of generating more revenues.

Published in	International Journal of Economics, Finance and Management Sciences (Volume 8, Issue 3)
DOI	10.11648/j.ijefm.20200803.11
Page(s)	89-97
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Assessed Amount of Tax, Length of Tax Payment Period, Tax Compliance, Taxpayers, Penalty

References

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APA Style

Dereje Birhanie Jemberie. (2020). Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers. International Journal of Economics, Finance and Management Sciences, 8(3), 89-97. https://doi.org/10.11648/j.ijefm.20200803.11

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ACS Style

Dereje Birhanie Jemberie. Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers. Int. J. Econ. Finance Manag. Sci. 2020, 8(3), 89-97. doi: 10.11648/j.ijefm.20200803.11

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AMA Style

Dereje Birhanie Jemberie. Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers. Int J Econ Finance Manag Sci. 2020;8(3):89-97. doi: 10.11648/j.ijefm.20200803.11

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@article{10.11648/j.ijefm.20200803.11,
  author = {Dereje Birhanie Jemberie},
  title = {Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {8},
  number = {3},
  pages = {89-97},
  doi = {10.11648/j.ijefm.20200803.11},
  url = {https://doi.org/10.11648/j.ijefm.20200803.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20200803.11},
  abstract = {This study is designed to investigate the determinants of tax compliance in a case of category “C” business profit taxpayers in Nekemte town. To achieve the designed objectives the study employed a quantitative approach. Necessary data for the study were gathered via questionnaire and reviewing necessary documents. To do this the researcher took out 346 samples from the total 2580 population size of category “c” taxpayers and analyzed the returned 240 questions. The sample size of the study was determined by using simple random sampling technique. Responses of respondents were presented by using the data presentation tools and analyzed via STATA 10 software application and descriptive analytical methods using tables and charts. The study found that, family size and length of tax payment period has a significant negative influence on tax compliance. On the other hand, tax knowledge and awareness and tax penalty and fines has a significant positive influence over the level of tax compliance. The assessed amount of tax, probability of auditing and attitudes towards equity and fairness are insignificant factors in determining the compliance behavior of taxpayer. Finally the researcher recommended that different job opportunities and incentives should be provided by the authorized body to increase earning of large size family members. ERCA should be follow up taxpayers and control their activities to easily prevent evasion by taxpayers; and sufficient and adequate training, awareness creation and education should be offered to taxpayers to enhance their knowledge regarding to tax. Besides ERCA should take measures and penalties on those taxpayers who are not willing to pay their tax liability within a specified time period for the purpose of generating more revenues.},
 year = {2020}
}

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TY  - JOUR
T1  - Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers
AU  - Dereje Birhanie Jemberie
Y1  - 2020/06/03
PY  - 2020
N1  - https://doi.org/10.11648/j.ijefm.20200803.11
DO  - 10.11648/j.ijefm.20200803.11
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 89
EP  - 97
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20200803.11
AB  - This study is designed to investigate the determinants of tax compliance in a case of category “C” business profit taxpayers in Nekemte town. To achieve the designed objectives the study employed a quantitative approach. Necessary data for the study were gathered via questionnaire and reviewing necessary documents. To do this the researcher took out 346 samples from the total 2580 population size of category “c” taxpayers and analyzed the returned 240 questions. The sample size of the study was determined by using simple random sampling technique. Responses of respondents were presented by using the data presentation tools and analyzed via STATA 10 software application and descriptive analytical methods using tables and charts. The study found that, family size and length of tax payment period has a significant negative influence on tax compliance. On the other hand, tax knowledge and awareness and tax penalty and fines has a significant positive influence over the level of tax compliance. The assessed amount of tax, probability of auditing and attitudes towards equity and fairness are insignificant factors in determining the compliance behavior of taxpayer. Finally the researcher recommended that different job opportunities and incentives should be provided by the authorized body to increase earning of large size family members. ERCA should be follow up taxpayers and control their activities to easily prevent evasion by taxpayers; and sufficient and adequate training, awareness creation and education should be offered to taxpayers to enhance their knowledge regarding to tax. Besides ERCA should take measures and penalties on those taxpayers who are not willing to pay their tax liability within a specified time period for the purpose of generating more revenues.
VL  - 8
IS  - 3
ER  -

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Author Information

Dereje Birhanie Jemberie

Department of Accounting and Finance, College of Business and Economics, Debre Markos University, Debre Markos, Ethiopia

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APA Style

Dereje Birhanie Jemberie. (2020). Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers. International Journal of Economics, Finance and Management Sciences, 8(3), 89-97. https://doi.org/10.11648/j.ijefm.20200803.11

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ACS Style

Dereje Birhanie Jemberie. Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers. Int. J. Econ. Finance Manag. Sci. 2020, 8(3), 89-97. doi: 10.11648/j.ijefm.20200803.11

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AMA Style

Dereje Birhanie Jemberie. Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers. Int J Econ Finance Manag Sci. 2020;8(3):89-97. doi: 10.11648/j.ijefm.20200803.11

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@article{10.11648/j.ijefm.20200803.11,
  author = {Dereje Birhanie Jemberie},
  title = {Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers},
  journal = {International Journal of Economics, Finance and Management Sciences},
  volume = {8},
  number = {3},
  pages = {89-97},
  doi = {10.11648/j.ijefm.20200803.11},
  url = {https://doi.org/10.11648/j.ijefm.20200803.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijefm.20200803.11},
  abstract = {This study is designed to investigate the determinants of tax compliance in a case of category “C” business profit taxpayers in Nekemte town. To achieve the designed objectives the study employed a quantitative approach. Necessary data for the study were gathered via questionnaire and reviewing necessary documents. To do this the researcher took out 346 samples from the total 2580 population size of category “c” taxpayers and analyzed the returned 240 questions. The sample size of the study was determined by using simple random sampling technique. Responses of respondents were presented by using the data presentation tools and analyzed via STATA 10 software application and descriptive analytical methods using tables and charts. The study found that, family size and length of tax payment period has a significant negative influence on tax compliance. On the other hand, tax knowledge and awareness and tax penalty and fines has a significant positive influence over the level of tax compliance. The assessed amount of tax, probability of auditing and attitudes towards equity and fairness are insignificant factors in determining the compliance behavior of taxpayer. Finally the researcher recommended that different job opportunities and incentives should be provided by the authorized body to increase earning of large size family members. ERCA should be follow up taxpayers and control their activities to easily prevent evasion by taxpayers; and sufficient and adequate training, awareness creation and education should be offered to taxpayers to enhance their knowledge regarding to tax. Besides ERCA should take measures and penalties on those taxpayers who are not willing to pay their tax liability within a specified time period for the purpose of generating more revenues.},
 year = {2020}
}

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TY  - JOUR
T1  - Determinants of Tax Compliance: A Case of Nekemte Town Category ‘C’ Business Profit Tax Payers
AU  - Dereje Birhanie Jemberie
Y1  - 2020/06/03
PY  - 2020
N1  - https://doi.org/10.11648/j.ijefm.20200803.11
DO  - 10.11648/j.ijefm.20200803.11
T2  - International Journal of Economics, Finance and Management Sciences
JF  - International Journal of Economics, Finance and Management Sciences
JO  - International Journal of Economics, Finance and Management Sciences
SP  - 89
EP  - 97
PB  - Science Publishing Group
SN  - 2326-9561
UR  - https://doi.org/10.11648/j.ijefm.20200803.11
AB  - This study is designed to investigate the determinants of tax compliance in a case of category “C” business profit taxpayers in Nekemte town. To achieve the designed objectives the study employed a quantitative approach. Necessary data for the study were gathered via questionnaire and reviewing necessary documents. To do this the researcher took out 346 samples from the total 2580 population size of category “c” taxpayers and analyzed the returned 240 questions. The sample size of the study was determined by using simple random sampling technique. Responses of respondents were presented by using the data presentation tools and analyzed via STATA 10 software application and descriptive analytical methods using tables and charts. The study found that, family size and length of tax payment period has a significant negative influence on tax compliance. On the other hand, tax knowledge and awareness and tax penalty and fines has a significant positive influence over the level of tax compliance. The assessed amount of tax, probability of auditing and attitudes towards equity and fairness are insignificant factors in determining the compliance behavior of taxpayer. Finally the researcher recommended that different job opportunities and incentives should be provided by the authorized body to increase earning of large size family members. ERCA should be follow up taxpayers and control their activities to easily prevent evasion by taxpayers; and sufficient and adequate training, awareness creation and education should be offered to taxpayers to enhance their knowledge regarding to tax. Besides ERCA should take measures and penalties on those taxpayers who are not willing to pay their tax liability within a specified time period for the purpose of generating more revenues.
VL  - 8
IS  - 3
ER  -

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