Value Added tax Revenue Performance and Administration Problems in Case of ERCA in Gondar
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Date
2014-02
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Addis Ababa University
Abstract
Every government needs dependable and sustainable domestic revenue so as to run its
function. In North Gondar, where substantial proportion of government revenue has been
collected from tax. However, in practice, VAT revenue performance in North Gondar
was not geared with VAT theoretical feature. This is due to VAT administration
problems particularly for key VAT administrative functions. Survey had been conducted
to gather information about taxpayers and tax officials’ attitude towards VAT
administration problems in case of ERCA in Gondar branch. Self-administered semi-
structured interviews and questionnaires were distributed for ten tax officials and fifty
VAT registered taxpayers respectively. Further, secondary data was collected to measure
the VAT revenue performance of the authority. The study tries to investigate and analyze
VAT administration problems in case of ERCA in Gondar branch and it tries to assess
VAT effectiveness in generating more government revenue (VAT revenue performance
in the authority). For this study Surveying method through semi- structured questionnaire
and semi- structure self administered questionnaire is used to investigate the research
questions mentioned in chapter one. Besides, the study used percentages, mean and
standard deviation statistical tools to strengthen and to make the study more systematic.
In general, to analyze the data, statistical package for social science (SPSS) soft ware
version 16 was employed. The result part presents response rate for tax official and
taxpayers survey, VAT administration tasks on key administration function, strength of
VAT administration, VAT rate and market competition. Finally, this section presented
VAT revenue performance of the authority and identifies VAT administration problems.
VAT is the major source of government revenue in most developing countries. Thus,
VAT has a significant role in the revenue system of government of Ethiopia. To sustain
its role for the generation of revenue, it is important to ensure that the revenue generated
by VAT system should be efficient as possible. In the survey opinions were forwarded by
the respondents. For instance, strengthening administration capacity by skilled manpower
and the required materials to encourage honest traders by rewarding them and giving
incentives and taxpayers should obey for the rules and should also cooperate with the
authorities’ operational activities
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Keywords
Ademinstration Problems in case of erca in gonda