Perception on Factor Affecting the Efficiency of Income Tax Administration in Large Tax Payer’s Branch Office of Ethiopia Revenue and Custom Authority

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Addis Ababa University


The goal of this research is to study on perception on factor affecting the efficiency of income tax administration in large tax payer branch office of ERCA. Employees, managers and tax payers of large tax payer’s branch office were the target population of the study. The total population of this study is 1156 tax payer and 53assessment, enforcement, collection, customer service officers and 50 auditors. To achieve this objective, the researcher used primary and secondary sources of data. In order to get primary information, questionnaire and interview was taken. As important as the primary data, the researcher also collected essential data from secondary sources .Data that obtained through review of such documents help to address the research objectives of the study and also the researcher used non-probability sampling techniques. Data collect from document review and interview interpreted qualitatively. The data collected and analyzed presented by using the following data presentation tools: Tables, histogram along with sufficient interpretations. Data also analyzed on quantitative basis using Pearson’s correlation, multiple linear regression analysis and descriptive statistics. The researcher undertakes the diagnostic tests for the assumption of classical linear regression model (CLRM). Based on the analysis and discussion of the research, it can be concluded that the tax knowledge, income tax law complexity and procedures and compliance rate has a significant effect on tax administration efficiency. The researcher conclude that the new income tax law clear, simple and understandable than the previous law. The branch has fewer arrears of income tax and the compliance rate also shows that there is tax gap. To improve this continuous follow up should be made to collect the tax due and enforce the tax payer to comply with the tax law. In addition, after the income tax reform implemented the income tax revenues have increased significantly. However, the income tax ratios do not increase accordingly.


A thesis submitted to the department of accounting and Finance (A.A.U) in partial fulfillment for the requirement of The degree of Master of Science in accounting & finance


Compliance rate, Efficiency, Tax knowledge, Tax law complexity