Ababa: Pathfinder International/Ethiopia Determinants of Tax Compliance Behavior in Category “C” Business Income Tax Payers in Gozamen District, East Gojjam Zone, Ethiopia

Abstract

The main purpose of this paper is to investigate determinants of tax compliance behavior in category “C” business income tax payers in Gozamen woreda / district/. To this end, the researcher follows quantitative research approach and descriptive research design. The researcher used cross sectional primary data collected from 318 category C business income tax payers selected with simple random sampling techniques. The study employed both descriptive statistics, and inferential statistics methods of data analysis. The descriptive statistics was summarized using average, minimum, maximum, standard deviation, percentage and frequency, and it was also presented in the form of multipurpose table, bar graph and histo-graph inferential statistics Binary Logit model was applied. The study finding reveled that tax compliance behavior is negatively affected by the influence of referent group and experience on business activity at 1 percent level of significance but positively influenced by legal sanction and penalty which is statistically significant at 1percent level of significance. Based on the above findings, the researcher recommends that, to improve the probability of tax compliance behavior of category “C” business income tax payers, Gozamen Woreda Revenue office  should create awareness in reducing the influence of referent group on tax payer, create awareness of experienced business man to rise tax compliance behavior and finally after awareness creation, impose legal sanction  and penalty or enforcing tax laws and regulation to rise tax complaince behaviour of category C business income tax payers in the study area .

Keywords:-Determinants, Tax compliance behavior, Gozamen district, Binary logit model.

DOI: 10.7176/RJFA/10-17-02

Publication date:September 30^th 2019