TAX ASSESSMENT AND COLLECTION RELATED

PROBLEM (IN CASE OF SAWLA TOWN REVENUE

AUTHORITY)

A RESEARCH PAPER SUBMITTED IN PARTIAL

FULFILLMENT OF THE REQUIREMENT
FOR BACHELOR OF ARTS DEGREE IN ACCOUNTING

BY:
KIDIST BELAY
ADVISOR:
ABIY GETAHUN

ARBAMINCH UNIVERSITY
BUSINESS AND ECONOMICS
DEPARTMENT OF ACCOUNTING

March, 2022
Arbaminch, Ethiopia
 SUMMERY

The study will be conducted tax assessment and collection problem in Sawla town
revenue authority. The general objective is to examine the tax assessment and collection
according to the established regulation of Sawla town authority and problem encountered
by tax payers and collecting authority. To achieve the objective all the necessary data will
be used. Descriptive types of research method will be used. Primary and secondary
source of data will be collected in order there gatherer information, which will help fall
for the study. Primary data will be collected through unstructured interviewer and
questionnaires distribution to employees and tax payers. Secondary data will be collected
from review the documents, manuals of Sawla town revenue authority report will be
issued to their employees and research will be judgment sampling for it advantage of
convinent to use all less time consuming. Finally the collected data will be processed,
analyzed and interpret by using different table, percentage, and recommendation and
conclusion will be forwarded based on the identified problems.

I
ACKNOWLEDGEMENTS

First of all I would like to thanks almighty God; without him nothing is possible. I am
highly indebted my advisor, Mr, Asrat Diriba (MSc) as without his encouragement,
insight, guidance, and professional expertise the completion of this will not be
possible. My special thanks also go to Sawla town revenue authority and civil
servants for their collaboration, enthusiasm and willingness to share their experiences
during this study.

Last but not the least my thanks also extend to those who will encouraged me, shared
ideas and provided with special support throughout my stay in the University.

II
Table of content

summery...............................................................................................................................I

Acknowledgment................................................................................................................II
Table of content.................................................................................................................III
List of table.........................................................................................................................V
Chapter One.........................................................................................................................1
1. Introduction......................................................................................................................1
1.1. Background of the study...........................................................................................1
1.2. Back ground of Organization....................................................................................3
1.3. Statement of the problem..........................................................................................4
1.4. Objectives of the Study.............................................................................................5
1.4.1. General objective...............................................................................................5
1.4.2. Specific objectives.............................................................................................5
1.5. Significance of Study................................................................................................6
1.6. Scope of Study......................................................................................................7
1.7. Organization Paper...................................................................................................7
Chapter Two........................................................................................................................8
2. Literature – Review.........................................................................................................8
2.1. The Review of Taxation (Tax) and Related Problem...............................................8
2.2. Importance of Taxation.............................................................................................9
2.3. Principle of Taxation................................................................................................9
2.3.1. Benefit Principle..............................................................................................10
2.3.2. Ability to Pay Principle...................................................................................10
2.4. Tax evasion and Avoidance....................................................................................10
2.5. Classification of Taxes Based on their Effect on Income.......................................11
2.5.1. Progressive Taxes............................................................................................11
2.5.2. Proportional Taxes...........................................................................................11
2.5.3. Regressive Taxes.............................................................................................12
2.6. Types of Taxes and Categories of Tax Payers........................................................12
2.6.1. Direct tax.........................................................................................................12
2.6.2. Indirect Tax......................................................................................................14
2.6.3. Categories of tax pay’s....................................................................................15
2.7. Tax administration..................................................................................................15
Chapter Three....................................................................................................................16
3. Research Design and Methodology...............................................................................16
3.1. Research Design.................................................................................................16
3.2. Research Methodology.......................................................................................16
3.3. Source of Data....................................................................................................16

III
 3.4. Method of Data Collection.....................................................................................16
3.5. Target Population and Sampling Method...............................................................17
3.5.1. Data Processing and Analysis..........................................................................17
3.5.2. Data Processing...............................................................................................17
3.5.3. Data Analysis...................................................................................................17
Chapter Four......................................................................................................................18
4. work plan.......................................................................................................................18
Chapter Five.......................................................................................................................19
5. Budget break down........................................................................................................19
References..........................................................................................................................20

IV
 LIST OF TABLE
Tables page
1. work plan..................................................................................... .................................18
2. Budget breakdown.........................................................................................................19

V
 CHAPTER ONE
1. Introduction

The taxes are the main sources of government revenues. A taxation policy depends on the
socio-economic and political structure of the country. History of Ethiopia system dates
back to ancient time. Forexamples. In the Akxumite kingdom there was a practice of
traditional taxation. The traditional taxation provide for taxes on crops, livestock and
livestock product such as wool, butter and milk (Gebrie, 2008). In Zerayacobs Chronicle
it is stated there was taxation at ancient times, however, it was during Zerayacob time
that first tax system introduced. The system was set for those people engaged in livestock
production. The first important reform carried out by Emperor Menelik Towards the end
of the 19th century resulted in the establishment of fixed tithe rather than the undefined
and essentially arbitrary system of agricultural taxes (Gebrie, 2006).

The most important features of the traditional taxation system continued during the
relatively modern administration of Emperor Haile Selasie I (1942 – 1974). The element
of the tax system of this era comprise personal income tax, business income tax,
agricultural income tax, land tax, education tax, health tax, road tax, salt tax, tobacco tax,
the tithe, Alchol tax. The first income tax of Ethiopia was enacting in 1994. The personal
and business tax proclamation No 60 of 1944. Reform income taxation in that it provided
a modern structural and legal frame work to the disorganized primarily system.
Proclamation in 107 replaced the first proclamation in 1994 and this proclamation was
replaced by income tax decree No. 19 in 1956 the fourth income tax low enacted by
income tax proclamation no 173 is 1961 and them Proclamation No 255/ 1967 (Ibid).

Personal business income tax where levied, charged and collected under each of the
schedule:- Schedule A- Applied to the taxation of income from employment.
Schedule B- applied to income from rent of land and building used for other than
agriculture purpose.
Schedule C- applied to income form business professional and vocational occupations,
the exploitation of woods and forests for.
Schedule D- applied to income from agricultural activities (Gebrie, 200 page 4,5,6).
The political up heaves of 1975 brought about the abolition of the feudal land tenure
system and the revoke of land taxes and the tithe. The health and education taxes were
also cancelled and the remaining types of taxes were extensively amended and
restructured by the Dergue and used until the traditional government of Ethiopia amends
anew taxation structure. During regime there was an increase in the coverage of tax bases
and tax rates owing to the need to raise more revenue to support (Ibid). The income tax
proclamation during this period were mainly amendment of the income tax proclamation
No 173/ 1961 and proclamation No 255/1967/, proclamation No 77/1976 and
proclamation No 152/1978 were aimed at changing the income tax structure levied on
agricultural activities.

According the tax two proclamations imposed rural and use fee tax on income from
agricultural activity. In line with the socialist ideology of the regime, the rate of rural land
use fee varied for farms and state forms.
Thus, the rate of rural land use fee was as follows.
 Every farmer who was a number of agricultural procedure cooperative paid birr 5.
 An individual peasant who was not a member of an agricultural procedure
cooperative paid birr 10.
 Every state farm paid Birr 12 heat ore under it possession.
To implement the right of nations, nationalist peoples to administrates their affairs the
transaction government of Ethiopia issued proclamation No 7/1992 providing for the
establishment of regional government.

Accordingly, regional government have legislative, executive and judicial power in

respect of all matters within their geographic area except such matter as defense, foreign
affairs,% economic policy conferring of citizenship, declaration of state of emergency
and printing of currently (Ibid).

2
1.1. Back Ground of study area

The town of Sawla was established as town in 1959 E.C. during the reign of Emperor
Haile Selassie. The main factors for its founding were its conductive climate and
environment, fertile soil, suitability for expansion of infrastructure, the presence of an
airport at that time, availability of water and different species including coffee, and its
importance as a business center. In 1963 the Gofa awuraja was transferred to sawla from
Bulki. In 2002/2003 SNNP regional state works and urban development bureau study has
classified it as one of the city administration in the region. It is one of the reform towns in
the region and has a municipal status consisting of urban kebelle and the town got the
first plan in 1965. Even though, the town was one of oldest town, its development was
retarded because of different reasons mainly the political status of the past regimes.
Having this, the regional governments of SNNP include the town among the reform
strategy and decide Sawula to be one of the reform towns as a result, the town established
as three administrative kebeles. After this the town develops at an alarming rate and
become one of the towns which have the high revenue.

3
1.2. Statement of the Problem

Taxation enables the government to provide administrative and compliance cost.

Therefore the government must guide the tax laws that enable it to collect its revenue
efficiently. Taxes are compulsory payment by every person or organization to the
government because the main source of revenue to government without expectation of
direct return. Taxes are burden some thus reduce the economic welfare of individual and
business (public) organizations. Because activate that are finance from taxation is bring
benefit to individual or organization. According to this sawla town revenue authority has
responsibility to asses and collects revenue in order to achieve the goal of developing the
economy of the town. But, they have some weakness and problem relating to tax
assessment and collection that the researcher will found solution.

1. How to tax payer can under stand the rule and regulation of tax?
2. What are the cause for the inadequacy of tax assessment and collection?
3. How can we eliminate tax evasion and avoidance problem by the tax payer?
4. What factors has to be taken to develop ability of tax payers to consider rich and poor
of the revenue authority?

4
1.3. Objectives of the Study

While identifying the problem tax assessment and collection related problem of revenue
authority at Sawla town the researcher has some general and specific objective.

1.3.1. General objective

The general objective study examines the tax assessment and collection according to
established regulation of Sawla town revenue authority and problem encountered by the
tax payers and collecting authority.

1.3.2. Specific objectives

 To provide standard assessment weather it is in accordance with the capacity and
expectation the tax payer.
 To cheek the existence of tax avoidance and tax evasion.
 To assess the tax payers knowledge and awareness about taxation.
 To assess the opinion of tax payers about taxation.

5
 1.4. Significance of Study

 To provide positive contribution in finding solution to the focused area.

 To develop the researcher experience, how to do another research for future time.
 To provide information for employees of the office the area in which their office
faces some problems regarding tax and collection related problem.
 To provide awareness to revenue authority and take corrective function for the
problems identifying.
 To give awareness to tax payers and encourage compliance of tax payers.
 To help the researchers for partial fulfillment of course of seminar in accounting.
 To know the tax and collection related problems
 It will be used as abases for another researcher who want to make further study on the
area.

1.5. Scope of Study

The overall scope of this study is focused on the extent to which the research objectives
are concerned. To avoid discrepancies, ambiguity, misunderstanding and other related
problems, in conducting the research objectives. The study on taxation is wide and very
vast and need long term study so researcher study will be restricted only in problem of
tax assessment and related collection problem in Sawla town revenue authority.

6
 CHAPTER TWO

2. LITERATURE REVIEW

2.1. The Review of Taxation (Tax) and Related Problem

A tax is a compulsory levy payable by an economic unit to the government without any
corresponding entitlement to receive a definite a direct quid pro quo from the
government. Note the word direct here, is not a price paid by the tax-payer for any
definite service rendered or a commodity supplied by the government. The benefits
received by tax payers from the government are not related to or based upon their tax
payers. A tax is a generalized execution, which may be levied on one or more criteria
upon individuals, groups of individuals or other legal entities (BL-Bhatia, 2003, 37).

Government at all levels, local state and national, requires people and business to pay
taxes. Government use the tax revenue to pay the cost of police and fire protection, health
programs schools, roads, national defense and many other public services. Tax and
taxation are generally regarded as unpleasant subjects. Justice john stated that “the power
to tax is the power to destroy” represents the rhetorical linkage of tax and tax so
inevitable. Taxes are also olds government. The general level of taxes has varied through
the years, depending on the role of the government. In modern times, many governments
as especially in advanced industrial countries have rapidly expanded their roles add taken
on new responsibilities. As results the need for the tax revenue has become great.
Government can finance their activities by borrowing creating or obtaining technical
assistance from abroad and denotations. Government also secure resources by profit from
public enterprises of from sale of produced on land. But the major service of revenue to
finance public expenditure is taxes (Ibid).

Compulsory contributions by persons or organization to the government with out

expectation of any direct return. Taxes are burden some these reduce the economic
welfare of individuals and business (public) organization. But activities that are financed
from taxes will bring benefits to individuals or organization (Encyclopedia v 1952).

7
2.2. Importance of Taxation

According to Bernard P. two payers in rent in sovereign government and regions give the
public sector the authority to institute tax laws. These revenue and police powers of
government nicest authoring to sovereign government control persons and properly for
the purpose of promoting the general welfare. Most taxes for both revenue and welfare
propose. All taxes by nature exert on income effect since compel drawal of revenue from
private sector and reduce the level of private sector phasing power. A tax can be defined
as a compulsory contribution from an individual for the purpose or goal.

Though a single purpose is typically dominated. All taxes by their nature provide
revenues to the government which imposes the taxes. In most instances the primary
motive for existence for tax. Tax may exist primary for regulator purpose. Tax may be
regulatory in either micro economic since. A regulatory tax designed to discourage the
consumption of particular item such alcholic beverage or to base of product (Bernard p.
1999).

2.3. Principle of Taxation

The pioneer economist like Adam smith who agrees for “laissze fair” which state that the
government minimal governance intervention. However Adam smith acknowledges the
role of the government in the provision of public. In his well know book” the wealth of
nation” publisher in 1776 has stated four principles which called them as canons of
taxation they are: - People should pay taxes according to their abilities (principle with
modern economist have subject to two interpretation) they are the benefit principle and to
pay principle can none of equity, The payment of tax should be clear, certain to the tax
payers and the tax collector cannot convenience, The cost of collection in relation to the
tax yield should be minimal cannon of economy.

8
Now days smith’s canons’ get wider perspective and some are added Todaro (1994) tried
to put factors which the tax potential in to five categories there are:-

1. The level of per capital income

2. The degree of inequality in the distribution of that income.
3. The industrial structure of the economic activity of example the importance for foreign
trade, the significance of the enterprises, the degree to which the agricultural sector is
commercialized as opposed to subsistence oriented.
4. The social, political and institutional setting and the relative power of different groups
(for example land lord as opposed to manufactures) organization.
5. The administration competence, honesty and integrity of the gathering branches of
government (Gebrie, 2006, page 20).

2.3.1. Benefit Principle

The benefits principle of taxation states that only the beneficiaries of a particular,
government programs should have to pay for it. The benefits principle regards public
service as similar to private goods and regards taxes, as the people must pay for these
services. The practical application of the benefits principle is extremely limited, because
most government services consumed by the community as a whole. For example, one can
not estimate the benefit received by a particular individual for general public services
such as national defense and local police protection, (Gebrie, 2008 page 21,22).

2.3.2. Ability to Pay Principle

The ability to pay principle holds that people, taxes should be based up on their ability to
pay, usually as measured by income or wealth. One implication of this principle is
horizontal equity, which states that people in equal positions should pay the same
amounts of tax. A second requirement of the ability to-pay principle is vertical equity, the
idea that a tax system should distribute the burden fairly across people with different
abilities to pay. This idea implies that a person with higher income pay more in taxes than
one with less income (Grbrie 2008, 2021).

9
2.4. Tax Evasion and Avoidance

Tax evasion is an illegal method of trying to reduce one’s tax bills. In other word, it is
illegal by redacting tax burden by under reporting income, over stating deduction of using
illegal tax shelters while tax avoidances an attempt to reduce tax liability to minimizing
tax burden through legal means such as tax free municipal bonds, tax shelters because of
the loopholes in the tax laws and the inefficient or corrupt tax administration gives rise to
tax avoidance or evasion. It involves choosing legal form and handling affairs in such
away as to taken advantage of legally permissible alternative tax rate or an alternate
method of assessing income.

Tax avoidance in contrast to tax evasion is considered by many to be legitimate aim since
it is not illegal but consists of exploiting the discrepancies and loopholes in the tax law to
the further extent. Among the most common method of tax avoidance are the
manipulation of capital gains and losses, the formation of holding companies to create
article deductions and eh creation of multiple trust for relatives and dependents. Tax
avoidance in the case of indirect taxes is high but taxes avoidance is relatively low
because directly taxes can be easily shifted forward or back ward (Indigo, 2002 and
world book 307 and 308).

2.5. Classification of Taxes Based On Their Effect on Income

Taxes based on their impact on income can be classified as progressive; proportional and
regressive.

2.5.1. Progressive taxes

The term progressive refers to the way the rate progresses from low to high. The rate of
taxation increase as the tax bases increases. Here as the income or sending increase the
marginal rate of tax increased, income or spending also rises. It is also possible to have a
progressive expenditure tax where the rate of rises with increment to consumption
expenditure. People with higher income tend to increase their spending on items subject
of the tax to such and extent that the payment becomes bigger portion of income Gebrie,
2006, 33)

10
2.5.2. Proportional Taxes

This kind of tax is whose rate remains constants as the size of the basic increases. A
proportional tax rate is usually stated as flat percentage of the base regardless of its size.
These kind of tax in Ethiopia are seen in the mining income tax proclamation 23/1996,
which sates that both large scale and small scale miner, shall pay 35% of their mining
income (Gebrie, 2006 p 32).

2.5.3. Regressive taxes

These kinds of taxes the marginal rate decreases as increase income. Tax a larger share
income from the low income tax payer than from the high income tax payer. A tax which
is technically proportional interims of the tax bases, can often be considered regressive
interims of tax payer income common examples, an excise tax on cigarette is based on
the on, of cigarettes sold (Green world, 1993).

To summaries the classification of tax by graphically as follows

Tax rate% Progressive

Proportional

Regressive

Tax base
Tax base (Gebrie, 2006 35).

2.6. Types of Taxes and Categories of Tax Payers

Governments impose many types of taxes. In most developed countries, individual pay
income taxes when they earn money, consumption taxes, when they spend it, property
taxes when they own a home or land, and in some case estate taxes when they die. In
general, interms of the relation ship between the nature of taxes and reason for payment,
taxes classified as direct and indirect taxes (Gebrie, 2008, 28 – 29).

11
2.6.1. Direct tax

Acceding to dalto, direct taxes are those, which are paid entirely by those persons on
whom they are imposed. Direct taxes are those taxes which can not be shifted to others
and it is made up of different individual taxes.
Personal income tax: are applied to the income of individual and families .
Capital gain tax business profit: - this is tax imposed on the taxable business income or
net profit realized from entrepreneurial activity.
Property tax: - are livied on the value of such property as firms houses, stores, factories
and business equipment property tax first become important in ancient time.

Merits and Demerits of Direct Taxes

Merit of Direct Taxes,

Equitable: - direct taxes such as income tax are equitable because it is based on the
principle progression. Certainty direct taxes satisfy the canon of certainty. The tax payer
is certain as to how much he/she is expected to pay and similarly the tax collector is
certain how much it receive.
Elasticity: - elasticity in direct taxes implies that the government collects more revenues
simply by raising the rate of taxation.
Reduce inequalities: - direct taxes are progressive in nature and therefore, rich people are
subject to his/her rate of taxation, while poor people are exempted from direct tax
obligation.
Ensures principle of ability to pay: - direct taxes are based on the principle of ability to
pay. The fall more heavily on the rich than poor. The tax burden is distributed on
different section of the social in just and equitable manner.
Control effect of traded cycles: - direct tax control the effect of trade cycles. They can be
used as tool to mitigate the effect of inflection and deflationary trends by raising or
reducing the tax rate (parameswarn; 2005).

Demerits of Direct Taxes

12
In convenience: tax payer should submit the statement of total income along with the
source of income from which is derived.
Evasion: direct tax is certain and tax payers know the rate of tax they have to pay,
therefore, awareness of tax liability to tempt the tax payer to evade tax.
Arbitrary: there is no logical or scientific principle to determine the degree of progression
in determing tax brackets (Gebrie 2008, 29).

2.6.2. Indirect Tax

Indirect tax is often avoidable and not taken from wages. Tax in which the burden may
not necessarily be swallowed by assesses, which means indirect taxes can be shifted on
the other persons (Gebrie worku 2008, 29 and Richard A. Margrave, 2989).
Example indirect taxes areas excise tax, value added tax, turn over tax
Excise taxes levied in respective of goods produced locally and imported good:-
Value added is a tax on customer expenditure. It is broad tax on the consumption of good
and service.
Turn over tax: - would be payable on goods sold and services rendered by persons not
registered for value all tax.

Merits of Indirect Taxes

Convenience: - indirect taxes are more convenient to the tax payers.

Wide scope: while the people with income and wealth above a certain limit, are brought
under the levy of direct taxes, indirect taxes are paid by all both poor and rich.
Elastic the revenue from the indirect taxes can be increased or decrease as government
need.
Tax evasion is not possible: - indirect taxes are included in the selling price of the
commodities so, evading of such tax become, very difficult.
Substantial revenue: - indirect taxes yield substantial revenue to both central and states of
government.
Progressive: - indirect taxes can be made progressive by imposing lower rate of taxes or
giving exemption to the necessary article and heavy taxes on luxurious articles
(paramesuarn 005).

13
Demerit Indirect Tax

Ability to pay principle violated: - indirect taxes are not directly connected to taxpayer
ability to pay.
Uncertainty: - if indirect taxes are not levied on the commodities of common
consumption and levied only on luxurious articles, they tend to be inelastic. The quality
demand will be affected by imposition of the taxes.
Discourages saving: - indirect taxes are included in the selling price of the commodities.
Hence, the people have to spend more on the purchase of the goods. This in turn affect of
the saving of the people.
High cost collection: - indirect taxes are un economical as they involve high cost of
collection.
Civic consciousness is not created: - under indirect taxes, tax payer don’t feel burden the
tax. They are not aware of their contribution to the state.
Inflationary: - the indirect taxes causes an increase in the price all around (Ramaswan;
2005).

2.6.3. Categories of tax pay’s

Category “A” tax payers whose annual income about 500,000 birr declare and pay tax
after the budgetary years four months. They are obligated to keep books of account and
present balance sheet and profit and loss statement to the tax office.
Category “B” tax payer
Tax payers who are under the threshold of annual turn over income between 100,0000 to
500,00 birr maintain records on books of daily revenue and expenditure and should
declare and pay tax after the budgetary year of carry on know months.
Categories “C” taxpayers
Tax payers whose annual turn over income up to 100,000 birr keep recodes and present it
for assessment. It is highly appreciated by the tax offices and pay tax after the budgetary
year of one month (Gebrie 2006, 64 and 65).

2.7. Tax administration

14
Since taxes are an involuntary payment for governmental services tax payers have a
strong inventive to minimize their tax liability either through avoidance (legal) or though
evasion (illegal). Tax administration has to secure compliance with the laws by applying
an array of registration. The ability to tax payers to keep form doing these procedures and
thus successfully avoid evading taxation determines the sizes and the nature of
economy’s actual effective tax base. Both evasion and avoidance’s seriously compromise
the demonstration of the tax system, producing a system that departs scientifically in its
operation from the one that is described on the tax legislation (Misrak).

CHAPTER THREE

3. RESEARCH DESIGN AND METHODOLOGY

3.1. Research Design

15
So as to put the objectives of the study in to effect, descriptive method will be conducted
to observe tax assessment and collection related problem.

3.2. Research Methodology

The study will be conducted in Sawla town particularly of the revenue authority limit to
the tax assessment and collection related problem. Taking variables in to consideration
different methods and materials will be utilized during the study.

3.3. Source of Data

Primary and secondary data source will be considered and used in the study. Primary
sources are the main source of information for the study. Some information for study will
be collected by researcher, using primary source of data collection through unstructured
interview and questionnaires. The study will be conducted by distributing questionnaires
to the Sawla town revenue authority employees and tax payer. Secondary data will be
collected data through survey and reviews the document manuals of Sawla town revenue
authority report issued to the employees.

3.4. Method of Data Collection

The study will be collected through by using primary and secondary data, primary data
will be obtained through questionnaires and interview. In order to get required
information the researcher will be selected data collectors and give orientation about the
method of data collection and explanation for the purpose of each item. Validity of data
collection will be accepted by principal investigator. Secondary data will be collected
from journal documentary record, annual reports periodically, magazine and other written
materials.

16
3.5. Target Population and Sampling Method

The data will be collected from different groups such as employees and tax payers that
have long term experiences in engaged in tax authority of revenue in Sawla town. In
order, to collect the desire data from these group. The judgment sampling will be used
among the non-probability sampling techniques. The reason behind selecting this
technique is less time consuming to get respondents; it enables the researcher to freely
select any respondents that he/she thinks best files to questions.

Sewla town revenue authority office has about 67 total employees, from 67 employees,
18 employees were selected from revenue authority office for unstructured interview and
questionnaire and from 4391 tax payer 70 tax were selected as sampling. So, as to save
time and cost efficiency and effectively the researcher was used to tax payer as a sample.

3.5.1. Data Processing and Analysis

3.5.2. Data processing

Data processing implies editing, coding and classification of collected data so as to make
suitable for further analysis. The research paper is also conducted after the collected data
will be edited. Coded and classified as per the techniques.

3.5.3. Data analysis

After the required data are processed classified, gathered, will be analyzed by using
methods of tabulation and percentages description.

17
 CHAPTER FOUR

4. WORK PLAN

Activity

March

April

June
May
Proposal Writing 

Proposal defense 

Identification of the study 

Regular visits of study area and questioner distribution and 

interviewing

Collection of questioner 

Data entry and coding 

Data analysis 

Research paper writing 

Thesis 1st draft report 

Incorporations of comment 

Final research submission 

Defense 

CHAPTER FIVE

18
5. BUDGET BREAK DOWN

No Items Expense Price Price Total cost

items Item/month
1 Price of data 4391 heads 2.00 8782
collection questioner
2 pen 4 4 16 144
3 A4ppr 200sht 0.25 50 450
4 CD 10 25 _ 250
5 flash 1 300 _ 300
6 photocopy 200ppr 0.5 _ 100
7 Computer writing 6opg 3 _ 180
8 printing 60pg 2 _ 120
9 binding 4 10 _ 40
10 meal 12day 60 720 4320
11 house 6month 600 600 3600
12 others - - - 2000
Total 41,984

6. REFERENCES

19
1. Bernand P. Herber modern public finalce (5th edition).
2. Dr BL. Bhatia, 2003 public finance 24th revise edition).
3. Dr Ramaswani parames warn Nov, 2005 public finance
4. Gebrie worku 2008, tax accounting in Ethiopia context 2nd edition.
5. Gebrie Worku (MSc) 2006, tax accounting in Ethiopia context 1st edition
6. Misrake Tesfaye, 2008, 1st edition. Ethiopia tax accounting theory and practice.
7. World, book, encyclopedia, vap 1952.

20
Appendix1: Data Recording Format and Questioner Survey

The purpose of questionnaire is to collect data on tax assessment and collection problem
in Sawla town and regarding confidentiality it is required only for academic purpose and
your respective response will be kept in confidentiality.

Instruction
Put tick mark  in the appropriate box for each question.
1. Sex
Male  Female 
2. Age
18 – 20  26 – 30  39-45 

21 – 25  31 – 38  > 45 

3. Marital status
Single  Divorced  Married  Widowed 

4. Education level
Grade 10th – 12th  Degree  Diploma

Certificate  Above degree 

5. Years of services
1. year  3-5 year 

2. year  > 5 year 

6. Do most tax payers pay their tax liability on time? Yes  No

7. How do you evaluate the knowledge of tax payers about taxation?

High  Medium Low

8. Who is more responsible for tax collection and assessment?

Tax payers  Any Governmental body Tax office 

21
Questionnaires to tax payers
1. How do you feel about taxation?
As an obligation 

As debt 

As useful 

2. When do you pay tax liability?

When I receive assessment notification

Before due date 

After due date 

3. How do you see the present taxation system?

Good  Need restatement  No bad 

4. Is your annals tax liability based on your income?

Yes  No 

5. Is the tax payment period enough?

Yes  No 

6. Do you face any problem when you got to pay tax liability?
Yes  No 

7. If you answer is yes for question 6 above what types of problem?

Absence of employee in the office 

Waiting for long time 

Cost of money in packed 

8. Do you know the annual income of your business?

Yes  No

9. How much do you satisfied from service you receive in turn to pay tax?
satisfied more  slightly satisfied  satisfied  dissatisfied

10. The amount of tax that you pay is related with service you receive.
I agree very much  I don’t agree 
I agree  I disagree strongly 
I can’t decide 

2
Questionnaires to tax payers
1. How do you feel about taxation?
As an obligation 
As debt 
As useful 
2. When do you pay tax liability?
When I receive assessment unitization 
Before due date 
After due date 
3. How do you see the present taxation system?
Good  Need restatement  No bad 
4. Is your annals tax liability based on your income?
Yes  No 
5. Is the tax payment period enough?
Yes  No 
6. Do you face any problem when you got to pay tax liability?
Yes  No 
7. If you answer is yes for question 6 above what types of problem?
Absence of employee in the office 
Waiting for long time 
Cost money in packed
8. Do you know the annual income of your business?
Yes  No 
9. How much do you stratified from service you receive in turn to pay tax?
Scarification more  slightly satisfied 
Satisfied  disserted 
10. The amount of tax that you pay is related with service you receive?
I agree very much  I don’t agree 
I agree  I disagree strongly
I can’t decide 