Abstract:
The purpose of this study was to assess the effect of Value Added Tax (VAT) administration
on revenue performance in Gamo Gofa Zone. The total population of the target group of
the study area 686 VAT registered tax payers from sample woredas. Out of 686 to achieve
this objective, the study has applied purposive sampling technique to select 253
representative respondents. Mixed research designs both quantitative and qualitative
methods were adopted. The secondary data were examined from annual reports of the
authority from the year 2004-008E.C.The Quantitative data were collected through
questionnaire and entered into statistical package for social science (SPSS) software
version 20 and analysed using tools of descriptive statistics such as: mean, frequency&
percentage. The qualitative data collected informer interview through prepared checklists
and semi-structured questions respectively were interpreted and analysed to triangulate
the data which were collected and analysed by using quantitative method. Generally, the
cumulative findings shown that lack of awareness among tax payers; limitation of payer
identification & registration; lack of effective audit practices; lack of supply and usage of
ETR machine are the effects for VAT administration in the study area. Established and in
depth creation of awareness, institutional capacity building, strong follow- up and
implication of the declared laws, rules and regulations, design to use modernized
monitoring mechanism, follow networking system that, SGTA (Standard Government Tax
Administration) & push tax payers to use cash registration machine are major
recommendations by the researcher according to its findings.
