THE INFLUENCE OF TAX EDUCATION ON TAX COMPLIANCE ATTITUDE A CASE STUDY IN ETHIOPIAN REVENUE AND CUSTOM AUTHORTY MERKATO NUMBER 2 BRANCH OFFICE

Abstract

The aim of this research is to examine the relationship between factors that affect tax knowledge and tax compliance behavior. The existence of high tax non-compliance behavior, lack of previous study in the area, inability to identify the root cause of noncompliance behavior, lack of success on previous effort that aims to minimize non-compliance behavior and the complexity nature of taxation system leads to conduct this paper. To determine the population of the study the researcher followed sequential frame procedure and finally 9,273 legally registered tax payers selected as target population among this 150 respondents selected as sample size of the study. To determine the respondent simple random sampling techniques were applied, self-administered questionnaire with 5-point likert scale questionnaire design technique and in-depth interview approach applied as data collection instrument technique. The collected data analyzed using descriptive and inferential statistical data analysis technique and to organize the data mean, percentage and standard deviation used in visually appealing tables, charts and in a graph formats. The result of this study revealed that there is statistically significant positive relationship between factors that determine tax knowledge and tax payer’s compliance behavior. In addition to their relationship all independent variables has unique and significant contribution for the prediction of compliance behavior. In order to solve the stated problem the research recommended to all stakeholders should be actively participate in knowledge creation process. Compliance behavior can’t be achieved unless otherwise, knowledge creation process given priority. To create knowledge individual tax payer’s should be actively seek knowledge , the organization should be continuously and meaningfully exert his effort in challenging societies’ culture and creating simple and accessible system