FACTORS AFFECTING VALUE ADDED TAX COLLECTION PERFORMANCE IN THE CASE OF GINNIR TOWN OF EAST BALE ZONE, OROMIA ETHIOPIA

The general objective of this research was to identify the factors affecting the
performance of VAT collection in the case of Ginnir Town in East Bale Zone. Thus, the
study used both descriptive and inferential statistics. Both qualitative and quantitative
data analysis techniques were used. The primary data were collected from VAT-
registered tax payers, employees of the Revenue Authority, and consumers. Secondary
data were collected from annual reports and document records about the current value-
added tax collection of the East Bale Zone Revenue Authority, the internet, thesis papers,
and journals. Convenience and purposive sampling techniques were used to select
appropriate and representative sample sizes from Value Added Tax registrants and tax
officials, respectively. As a result, from 322 Value Added Tax registrants and tax
officials whose activity is directly related to value-added tax assessment and collection,
178 samples were selected. The sample taken from each process departments were 108
tax payers, 15 Ginnir Town Revenue Authority employees, and 55 consumers.
Descriptive statistics and econometric models through multiple linear regression models
were used with the help of SPSS version 25 statistical software. This study found Tax
payers; Revenues Authority employees and consumers related factors affect the
performance of value added tax collections in study areas. The Results of the study
showed that Tax knowledge, and Value Added Tax rate were positively influenced Value
added Tax collection performance Whereas Technical staff competence, Value Added
Tax audit, tax registrant and Value Added Tax assessment variables were positively
influenced Value added Tax collection performance and political pressure variable
negatively affected Value added Tax collection performance for Revenues Authority
employees variables and statistically significant. This study recommends that the
government and Revenues Authority should take corrective action on Tax payers who
perform Tax collection. Revenues Authority should fulfill adequate man power and
registered Value Added Tax payers who fulfill the criteria but not registered to increase
Value Added Tax Collection performance. Also Revenues Authority must assess Value
Added Tax and audit Value Added Tax on time to increase Value Added Tax collection.2