Factors Affecting Tax Evasion in Ministry of Revenues. The Case of Large Taxpayers Branch Office

Master's Thesis , 84 Pages

Business economics - Accounting and Taxes

The general objective of the study is to identify the determinant causes of tax evasion in the Ministry of Revenue Large Taxpayers branch office. This study tries to address the following specific objectives: To identify the impact of tax rate and level of income on tax evasion. To indicate whether inflation affects tax evasion or not. To show effects of the complexity of the tax system such as penalty and probability of detection on tax evasion. To detect the relationship between the perceived role of government and tax evasion. To determine the effects of attitude and perception on tax evasion. To identify the effects of age, gender, education level of taxpayers and pear pressure on tax evasion.

Tax evasion is a global scenario irrespective of any attribute of a country and has been experienced in both developed as well as developing countries. Unless nations can mitigate and minimize the magnitude of tax evasion, it will be difficult to overcome illicit financial activities & cash flows and drain channels of corruption.

As per the above article, Yonas Sendaba and his group's tax evasion includes all unlawful activities by a taxpayer with the motive of minimizing tax liability. It occurs when taxpayers intentionally failed to execute their tax responsibility. It is an intentional violation of laws and it is evident in situations where tax liability is fraudulently reduced, or false claims are filled on the revenue tax form. Tax evasion does not only minimizes government revenue but also harms the current and future economic development of the country. Whether evaders understand or not, they share the problem of the society caused by tax evasion. Most public goods provided by the government are financed by revenue collected from the tax.

As the collection of revenue from tax and customs minimizes, the government is forced to minimize the provision of goods and services to the general public. As the result, related factors of development are affected. However, the factors of tax evasion are not well identified; there are indicators of the presence of tax evasion and its effects. Therefore, this research tries to investigate major factors of tax evasion and prioritize these factors for better recommendation to the concerned body and contribute to the improvement of the tax system.

Inhaltsverzeichnis (Table of Contents)

• Abstract
• Acknowledgements
• List of tables.
• List of figures.
• List of Appendices
• List of Acronyms/abbreviations....
• CHAPTER ONE: INTRODUCTION
• 1.1 Background of the study.
• 1.2 Statement of the problem..
• 1.3 Research questions........
• 1.4 Objectives of the study..
• 1.4.1 General objective of the study..
• 1.4.2 Specific objective..
• 1.5 Significance of the study......
• 1.6 Scope of the study.
• 1.7 Description of the Study Area
• 1.8 Limitation of the study
• 1.9 Organization of the Study....
• CHAPTER TWO: REVIEW OF RELATED LITERATURE.
• 2.1 Theoretical Literature Review
• 2.1.1 Ethiopian tax policy.
• 2.1.2 Tax Evasion
• 2.1.3 Why Do Taxpayers evade tax?
• 2.1.4 Risk level of the taxpayer
• 2.1.5 Methods for estimating the extent of tax evasion.
• 2.2 Why should we take care of tax evasion?
• 2.3 Empirical Literature Review.
• 2.3.1 Tax...
• 2.3.2 History of Taxation in Ethiopia.
• 2.3.3 Tax Evasion
• 2.3.4 Causes of tax evasion
• 2.3.5 Determinants of tax evasion
• 2.4 Conceptual framework.......
• 2.5 Summary and Knowledge Gap
• CHAPTER THREE: RESEARCH DESIGN AND METHODOLOGY.
• 3.1 Introduction.
• 3.2 Operational definition of variables........
• 3.3 Research Design
• 3.4 Research approach.
• 3.5 Population and Sample..
• 3.6 Population, sample, and sampling techniques....
• 3.6.1 Sample size
• 3.6.2 Sampling techniques.
• 3.7 Research Approach...
• 3.8 Type of data and data collection tools and method
• 3.9 Data analysis techniques..
• 3.10 Ethical considerations in the study....
• CHAPTER FOUR: DATA ANALYSIS AND FINDINGS.
• 4.1 Introduction.........
• 4.2 Demographic data
• 4.3 Analysis of data results concerning the variables
• 4.3.1 Effects of tax evasion on resource accumulation of individuals, public service, and government debt.......
• 4.3.2 Impacts of Tax Rate on tax evasion..
• 4.3.3 Impacts of income levels of taxpayers on tax evasion.
• 4.3.4 Impacts of inflation rate on tax evasion.
• 4.3.5 Impacts of the probability of detection and capacity of investigation.
• 4.3.6 Effects of penalty on tax evasion.........
• 4.3.7 Impacts of the complexity of tax law and its administration system on tax evasion .......
• 4.3.8 Impact of perceived roll of Government on the use of tax revenue to public service on tax evasion......

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

This thesis examines the factors affecting tax evasion within the large taxpayer's branch office of the Ethiopian Ministry of Revenue. The study aims to identify and analyze the key determinants of tax evasion, contributing to a deeper understanding of this issue and its implications for the Ethiopian government's ability to deliver public goods and services.

• The influence of tax rates and income levels on tax evasion behavior.
• The role of government policies and enforcement mechanisms in deterring tax evasion.
• The impact of taxpayer perception and awareness on voluntary compliance.
• The significance of the complexity of tax laws and their administration in facilitating tax evasion.
• The potential impact of tax education and awareness campaigns on tax evasion.

Zusammenfassung der Kapitel (Chapter Summaries)

Chapter One introduces the study's context, outlining the background of tax evasion in Ethiopia and its significance. The chapter details the research questions, objectives, and scope of the study, as well as the limitations and organization of the research. Chapter Two explores the theoretical and empirical literature on tax evasion. It examines the Ethiopian tax policy, various factors influencing tax evasion, and the methods used to estimate its extent. Additionally, the chapter delves into the history of taxation in Ethiopia and analyzes the determinants of tax evasion. Chapter Three focuses on the research design and methodology employed in the study. It defines the variables, explains the research approach, and details the population, sample, and sampling techniques used. The chapter also discusses data collection methods, data analysis techniques, and ethical considerations. Chapter Four presents the findings of the study through a comprehensive analysis of data. It examines the demographic characteristics of the participants and analyzes the relationship between the various factors and tax evasion behavior. The chapter provides insights into the impact of tax rates, income levels, government policies, perception, and the complexity of tax laws on tax evasion.

Schlüsselwörter (Keywords)

Tax evasion, tax policy, tax rate, income levels, probability of detection, penalty rate, complexity of tax system, perceived role of government, peer influence, tax education, voluntary compliance, Ethiopian Ministry of Revenue, large taxpayers.

• Pages: 84
• Catalog Number: V1294318
• ISBN (PDF): 9783346759528
• ISBN (Book): 9783346759535
• Language: English
• Tags: factors, affecting, evasion, ministry, revenues, case, large, taxpayers, branch, office