Abstract:
The primary objective of this study was to investigate factors affecting tax compliance behavior
of category ‘B’ tax payers in Gamo Zone. Explanatory research design was employed, and
quantitative research approach was used. Primary data was used to achieve the intended
objective of the study. Finally, after collecting the relevant data, the data was analyzed by using
both descriptive and inferential statistics. The study found that gender, simplicity of tax system,
transparency, perception on equity, personal financial constraint, tax knowledge, tax audit and
political affiliation as the significant factors affecting the tax compliance behavior of category
‘B’ tax payers in Gamo Zone. The study recommended that it is better to make simple the tax
system by avoiding unnecessary steps and complexities in the process of tax payment as the
simplicity of tax system enhances tax compliance and is also advisable to make clear and open
the activities of tax authorities as the transparency of tax authorities contributes to the improvement of tax compliance level.
