THE EFFECT OF ELECTRONIC TAX FILING SYSTEM ON TAX COMPLIANCE: THE CASE OF MINISTRY OF REVENUES LARGE TAXPAYERS’ BRANCH OFFICE.

Abstract

The Objective of this study was to establish the effects of electronic tax system on tax compliance among large taxpayers in Ministry of Revenues, Ethiopia. This objective was answered using three research questions which revolved around, electronic tax filing, electronic tax remittances and challenges on electronic tax system. The study adopted a survey explanatory research design. Data was collected using structured questionnaire, which covered all the variables of the study from 150 sampled taxpayers from large taxpayers who had been registered in Ministry of Revenues, large taxpayers’ branch office. Data obtained were subjected to quantitative methods of data analysis using SPSS (version 20). In addition to descriptive statistics, both correlation and regression analyses were done, and summaries presented. The study concluded that electronic filing system influences tax compliance level among large taxpayers as far as e-tax filing, e-tax remittance and challenges of e-tax system were concerned. The study also established that there was a positive attitude by clients towards electronic filing. Electronic filing has also significantly increased the ease of doing business the correlation analysis indicates that there was positive correlation between e-tax filing, e-tax remittance and tax compliance. From regression analysis, it was revealed that holding e-tax filing, e-tax remittances and challenges of filing tax returns to a constant zero, tax compliance will stand at 0.071The study recommends that a further study should be done to establish other factors and expand scope that affect tax compliance among large taxpayers.