TAX ASSESSMENT AND COLLECTION PROBLEMES OF CATEGORY ‘C’ TAX PAYERS: A CASE OF ADDIS KETEMA SUB CITY WOREDA 5

Abstract

The study was conducted to assess the problems of category “C” tax assessment and collection in addiss ketema sub city woreda 5 presumptive tax payers’ office. Although, data were collected from various sources, the tax payers’ and employee survey were the main sources of data for the study. In this regard, a total of 89 tax payers, and 11 employees of revenue office have participated in the study as a source of information. In addition, interview was used to get key informants from manager and vice manger of revenue office. Exploratory methods such as percentages, frequency, mean, tables, and figure were used to summarize the study findings and present the results. Generally, findings of the study revealed that woreda 5 presumptive tax payers office tax assessment and collection was not effective , most of the taxpayers, (category “C tax payers), have been facing various problems related to the taxation system. Despite the tax payers positive attitude towards the concept of appeal and review system, most of the surveyed tax payers stated that what they are paying is beyond their ability to pay and that they neither have trust in the employees of the authority nor in the overall tax estimation, and assessment procedures. Category “C” assessment rule is ambiguous and not suitable as it provides room for, corruption and tax evasion. In light of these facts, the study concluded that the tax authority of the woreda administration is not being effective or is being reluctant in making the tax in solving the above problems. Thus, it is recommended that the responsible tax authorities should revise the rule to make suitable for effective tax assessment, make suitable condition for category ‘C’ tax payers to keep book of account, give training for both employees and tax payers. .