What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia

Yonas Sendaba; Tsegazeab Teklemariam; Daniel Balcha; Samson Wondimu; Tariku Lorato

doi:doi:10.11648/j.jfa.20210904.12

| Peer-Reviewed

What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia

Yonas Sendaba, Tsegazeab Teklemariam, Daniel Balcha, Samson Wondimu, Tariku Lorato

Published in Journal of Finance and Accounting (Volume 9, Issue 4)

Received: 28 May 2021 Accepted: 6 July 2021 Published: 13 July 2021

Views: Downloads:

Download PDF

Share This Article

Twitter
Linked In
Facebook

Abstract

Tax evasion is a phenomenon in every nation even if the magnitude and causes may vary. It is associated with the introduction of taxation itself; tax evasion is a serious problem to a tax system. Therefore, examining what contributes to evasion in a given tax system is vital so that the negative consequences might be identified and solved. The study sought to identifies determinant factors of taxes evasion attitude of taxpayers in selected five zones: Gedeo, Gamo, Hadiya, Halaba and Gurage zone of Southern Nations, Nationalities and Peoples Regions (SNNPR) Ethiopia. Using Yamane (1967) formula and sampled 956 respondents. We have categorized our respondents as evaders, non-evaders and neutral based on the average value of their response and exclude neutral respondents. Accordingly, we used 768 questionnaires. We used a logistic regression model to examine what determines the evasion attitude of taxpayers. It is identified that significant difference among taxpayers towards tax evasion at zone level; Category A taxpayers are inclined to evasion compared to B; the level of education, peer, tax rate, and tax system has contributed to tax evasion attitude positively; and Authorized accountants are found to be facilitators for evasion. Based on our result we concluded that system orients variables are the most determinant factors affecting the evasion attitude of taxpayers compared to demographic attributes.

Published in	Journal of Finance and Accounting (Volume 9, Issue 4)
DOI	10.11648/j.jfa.20210904.12
Page(s)	117-126
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2021. Published by Science Publishing Group

Keywords

Tax Evasion Attitude, Determinants, Logistic Regression Model, SNNPR, Ethiopia

References

[1]	D. J. Hessin, K. A. Kinsey, H. Elfeers and R. H. Weigel, "Measurement Strategies and Theoretical Models," in Hand Book of Economic Psychology, Dordrecht, Kluwer Academic Publishers, 1988, pp. 517-535.
[2]	A. Ghafoor and A. Hannan, "The Determinants of Tax Evasion in Pakistan: A case Study of Southern Punjab," International Journal of Development and Economic Sustainability, vol. 2, no. 4, pp. 50-69, 2014.
[3]	J. F. Adebisi and D. O. Gbegi, "Effect of Tax Avoidance and Tax Evasion on Personal Income Tax Administration in Nigeria," American Journal of Humanities and Social Sciences, vol. 1, no. 3, 2013.
[4]	M. Mansor and Z. Gurama, "The Determinants of Tax Evasion in Gombe State Nigeria," International Journal of Economics and Financial I, vol. 6, no. 7, pp. 165-170, 2016.
[5]	M. Mughal and M. Akram, "easons of tax Avoidance and Tax Evasion: Reflections from Pakistan," Journal of Economics and Behavioural Studies, vol. 4, no. 4, pp. 217-222, 2012.
[6]	G. Beckeer, "Crime and punishment: An economic Approach.," Journal of Political Economy, vol. 76, pp. 169-217, 1698.
[7]	T. Ritsatos, "Tax evasion and compliance; from the neo classical paradigm to behavioural economics," Journal of Accounting & Organizational Change, vol. 10, no. 2, pp. 244-262, 2014.
[8]	L. Mills and K. Newberry, "The influence of tax and nontax costs on book-tax reporting differences: public and private firms," Journal of American Taxation Association, vol. 23, no. 1, pp. 1-19, 2011.
[9]	N. Kiri, "FACTORS AFFECTING TAX EVASION," International Journal of Economics, Commerce and Management, vol. 4, no. 2, 2016.
[10]	M. b. Mansor and A. A. Pantamee, "Tax Evasion and Nigeria Tax System," Research Journal of Finance and Accounting, vol. 6, 2015.
[11]	G. O. Yalama and E. Gumus, "Determinants of Tax Evasion Behavior: Empirical Evidence from Survey Data," International Business and Management, vol. 6, no. 2, pp. 15-23, 2013.
[12]	V. J. Hercullas, "Factors influencing tax evasion," University of Pretoria, 2011.
[13]	J. H. VENTER, FACTORS INFLUENCING TAX EVASION.
[14]	M. Battaglini, L. Guiso, C. Lacava and a. E. Pattacchini, Tax Professionals: Tax-Evasion Facilitators or Information Hubs?, Cambridge: NATIONAL BUREAU OF ECONOMIC RESEARCH, 2019.
[15]	P. Sikka and M. P. Hampton, "The role of accountancy firms in tax avoidance: Some evidence and issues," Journal of Accountancy, vol. 29, no. 3, pp. 325-343, 2006.
[16]	A. Amina and K. Saniya, "TAX COMPLIANCE AND ITS DETERMINANT THE CASE OF JIMMA ZONE, ETHIOPIA," International Journal of Research In Social Sciences, vol. 6, no. 2, pp. 7-21, 2015.
[17]	D. Endashaw, "Determinants of Tax Evasion in Addis Ababa City Administration: The Case of Bole Sub City Category “A” Taxpayers," UNPUBLISHED, 2019.
[18]	CSA, "Population and Housing Census of Ethiopia," Central Statistic, Addis Ababa, 2007.
[19]	N. K. Malhotra, Basic Marketing Research: A Decision-Making Approach, 2, Ed., 2006.
[20]	M. L. P. &. T. A. Saunders, Research Methods for Business Students, 6, Ed., Pearson, 2012.
[21]	A. BRYMAN and E. BELL, Business Research Methods, 3rd ed., OXFORD UNIVERSITY PRESS, 2011, p. 187.
[22]	T. Yamane, Statistics: An Introductory Analysis, 2, Ed., New York: Harper and Row, 1967.
[23]	A. Kumar, Research and writing skills, New York: Lulu press, 2011.
[24]	D. W. Lemeshow and S. Hosmer, Applied Logistic Regression, 2 ed., New York: John Wiley & Sons Inc, 2000.
[25]	D. N. Gujarati, Basic Econometrics. 4th edition, New York, USA: The McGraw-Hill Companies, Inc, 2004.
[26]	J. Pallant, SPSS SURVIVAL MANUAL: A step by step giude to data analysis using SPSS for widows (Version 10 and 11), Suffolk: Edmundsbury Press Ltd., 2001.
[27]	J. E. Fincham, "Response Rates and Responsiveness for Surveys, Standards, and the Journal," American Journal of Pharmaceutical Education, vol. 72, no. 2, pp. 1-3, 2008.
[28]	Y. Barch, "Resposne Rate in Academic Studies- A comparative Analysis," Human Relations, vol. 52, no. 4, pp. 421-438, 1999.
[29]	D. A. Paul, Logistic Regression Using SAS®: Theory and Application, Second Edition, Cary, NC, USA: SAS Institute Inc, 2012.
[30]	W. Green, Econometric analysis of Explanatory Variable, 5th, Ed., New Jersey: Upper Saddle River, 2007.
[31]	S. K. Antwi, A. M. Inusah and K. Hamza, "The Effect of Demographic Characteristics of Small and Medium Enterpreneurs on Tax Compliance in the Tamale Metropolis, Hgana," International Journal of Economics, Commerce and Management, vol. 3, no. 3, pp. 1-20, 2015.
[32]	M. R. Palil, M. M. Malek and A. R. Jaguli, "Issues, Challenges and Problems with Tax Evasion: The Institutional Factors Approach," Gadjah Mada International Journal of Business, vol. 18, no. 2, pp. 187-206, 2016.
[33]	R. F. Wei and J. Shang, "Tax Rate and Tax Evasion: Evidence from the “Missing Imports” in China," Columbia University, Washington,, 2001.
[34]	S. Terzić, "Model for determining subjective and objective factors of tax evasion," journal for sustainable development, no. 3, pp. 49-62, 2017.
[35]	W. A. K. P. F. Ahmad, "Causes of Tax Evasion in Pakistan: A case study on southern Punjab," International Journal of Accounting and Financial Reporting, vol. 4, no. 2, pp. 273-292, October 2014.
[36]	A. Lumir, "Determinants of Business Tax Evasion in Transition Economies," StaffordshireUniversity Business School, 2013.
[37]	A. Nourzad and S. Crane, "Tax Rates and Tax Evasion; Evidence from Californiya Amnesty Data," National Tax Journal,, vol. 43, no. 2, pp. 189-99, June 1990.
[38]	D. A. Nugent, "Legislating Morality: The Effects Of Tax Law Complexity On Taxpayers’ Attitudes," The Journal of Applied Business Research, vol. 29, no. 5, pp. 1479-1494, 2013.
[39]	E.-M. J. Gambo, A. Mas’ud, M. Nasidi and O. S. Oyewole, "Tax Complexity and Tax Compliance in African Self Assessment Enviroment," International Journal of Management Research & Revi, vol. 4, no. 5, pp. 575-582, 2014.
[40]	World Bank, "Doing Business 2020," International Bank for Reconstruction and Development, Wahington D.C., 2020.

Cite This Article

Plain Text BibTeX RIS

APA Style

Yonas Sendaba, Tsegazeab Teklemariam, Daniel Balcha, Samson Wondimu, Tariku Lorato. (2021). What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia. Journal of Finance and Accounting, 9(4), 117-126. https://doi.org/10.11648/j.jfa.20210904.12

Copy | Download

ACS Style

Yonas Sendaba; Tsegazeab Teklemariam; Daniel Balcha; Samson Wondimu; Tariku Lorato. What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia. J. Finance Account. 2021, 9(4), 117-126. doi: 10.11648/j.jfa.20210904.12

Copy | Download

AMA Style

Yonas Sendaba, Tsegazeab Teklemariam, Daniel Balcha, Samson Wondimu, Tariku Lorato. What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia. J Finance Account. 2021;9(4):117-126. doi: 10.11648/j.jfa.20210904.12

Copy | Download

@article{10.11648/j.jfa.20210904.12,
  author = {Yonas Sendaba and Tsegazeab Teklemariam and Daniel Balcha and Samson Wondimu and Tariku Lorato},
  title = {What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia},
  journal = {Journal of Finance and Accounting},
  volume = {9},
  number = {4},
  pages = {117-126},
  doi = {10.11648/j.jfa.20210904.12},
  url = {https://doi.org/10.11648/j.jfa.20210904.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20210904.12},
  abstract = {Tax evasion is a phenomenon in every nation even if the magnitude and causes may vary. It is associated with the introduction of taxation itself; tax evasion is a serious problem to a tax system. Therefore, examining what contributes to evasion in a given tax system is vital so that the negative consequences might be identified and solved. The study sought to identifies determinant factors of taxes evasion attitude of taxpayers in selected five zones: Gedeo, Gamo, Hadiya, Halaba and Gurage zone of Southern Nations, Nationalities and Peoples Regions (SNNPR) Ethiopia. Using Yamane (1967) formula and sampled 956 respondents. We have categorized our respondents as evaders, non-evaders and neutral based on the average value of their response and exclude neutral respondents. Accordingly, we used 768 questionnaires. We used a logistic regression model to examine what determines the evasion attitude of taxpayers. It is identified that significant difference among taxpayers towards tax evasion at zone level; Category A taxpayers are inclined to evasion compared to B; the level of education, peer, tax rate, and tax system has contributed to tax evasion attitude positively; and Authorized accountants are found to be facilitators for evasion. Based on our result we concluded that system orients variables are the most determinant factors affecting the evasion attitude of taxpayers compared to demographic attributes.},
 year = {2021}
}

Copy | Download

TY  - JOUR
T1  - What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia
AU  - Yonas Sendaba
AU  - Tsegazeab Teklemariam
AU  - Daniel Balcha
AU  - Samson Wondimu
AU  - Tariku Lorato
Y1  - 2021/07/13
PY  - 2021
N1  - https://doi.org/10.11648/j.jfa.20210904.12
DO  - 10.11648/j.jfa.20210904.12
T2  - Journal of Finance and Accounting
JF  - Journal of Finance and Accounting
JO  - Journal of Finance and Accounting
SP  - 117
EP  - 126
PB  - Science Publishing Group
SN  - 2330-7323
UR  - https://doi.org/10.11648/j.jfa.20210904.12
AB  - Tax evasion is a phenomenon in every nation even if the magnitude and causes may vary. It is associated with the introduction of taxation itself; tax evasion is a serious problem to a tax system. Therefore, examining what contributes to evasion in a given tax system is vital so that the negative consequences might be identified and solved. The study sought to identifies determinant factors of taxes evasion attitude of taxpayers in selected five zones: Gedeo, Gamo, Hadiya, Halaba and Gurage zone of Southern Nations, Nationalities and Peoples Regions (SNNPR) Ethiopia. Using Yamane (1967) formula and sampled 956 respondents. We have categorized our respondents as evaders, non-evaders and neutral based on the average value of their response and exclude neutral respondents. Accordingly, we used 768 questionnaires. We used a logistic regression model to examine what determines the evasion attitude of taxpayers. It is identified that significant difference among taxpayers towards tax evasion at zone level; Category A taxpayers are inclined to evasion compared to B; the level of education, peer, tax rate, and tax system has contributed to tax evasion attitude positively; and Authorized accountants are found to be facilitators for evasion. Based on our result we concluded that system orients variables are the most determinant factors affecting the evasion attitude of taxpayers compared to demographic attributes.
VL  - 9
IS  - 4
ER  -

Copy | Download

Author Information

Yonas Sendaba

Department of Accounting and Finance, Dilla University, Dilla, Ethiopia
Tsegazeab Teklemariam

Department of Accounting and Finance, Dilla University, Dilla, Ethiopia
Daniel Balcha

Department of Accounting and Finance, Dilla University, Dilla, Ethiopia
Samson Wondimu

Department of Accounting and Finance, Dilla University, Dilla, Ethiopia
Tariku Lorato

Department of Economics, Dilla University, Dilla, Ethiopia

Download PDF

Sections

Plain Text BibTeX RIS

APA Style

Yonas Sendaba, Tsegazeab Teklemariam, Daniel Balcha, Samson Wondimu, Tariku Lorato. (2021). What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia. Journal of Finance and Accounting, 9(4), 117-126. https://doi.org/10.11648/j.jfa.20210904.12

Copy | Download

ACS Style

Yonas Sendaba; Tsegazeab Teklemariam; Daniel Balcha; Samson Wondimu; Tariku Lorato. What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia. J. Finance Account. 2021, 9(4), 117-126. doi: 10.11648/j.jfa.20210904.12

Copy | Download

AMA Style

Yonas Sendaba, Tsegazeab Teklemariam, Daniel Balcha, Samson Wondimu, Tariku Lorato. What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia. J Finance Account. 2021;9(4):117-126. doi: 10.11648/j.jfa.20210904.12

Copy | Download

@article{10.11648/j.jfa.20210904.12,
  author = {Yonas Sendaba and Tsegazeab Teklemariam and Daniel Balcha and Samson Wondimu and Tariku Lorato},
  title = {What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia},
  journal = {Journal of Finance and Accounting},
  volume = {9},
  number = {4},
  pages = {117-126},
  doi = {10.11648/j.jfa.20210904.12},
  url = {https://doi.org/10.11648/j.jfa.20210904.12},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jfa.20210904.12},
  abstract = {Tax evasion is a phenomenon in every nation even if the magnitude and causes may vary. It is associated with the introduction of taxation itself; tax evasion is a serious problem to a tax system. Therefore, examining what contributes to evasion in a given tax system is vital so that the negative consequences might be identified and solved. The study sought to identifies determinant factors of taxes evasion attitude of taxpayers in selected five zones: Gedeo, Gamo, Hadiya, Halaba and Gurage zone of Southern Nations, Nationalities and Peoples Regions (SNNPR) Ethiopia. Using Yamane (1967) formula and sampled 956 respondents. We have categorized our respondents as evaders, non-evaders and neutral based on the average value of their response and exclude neutral respondents. Accordingly, we used 768 questionnaires. We used a logistic regression model to examine what determines the evasion attitude of taxpayers. It is identified that significant difference among taxpayers towards tax evasion at zone level; Category A taxpayers are inclined to evasion compared to B; the level of education, peer, tax rate, and tax system has contributed to tax evasion attitude positively; and Authorized accountants are found to be facilitators for evasion. Based on our result we concluded that system orients variables are the most determinant factors affecting the evasion attitude of taxpayers compared to demographic attributes.},
 year = {2021}
}

Copy | Download

TY  - JOUR
T1  - What Determines Tax Evasion Attitude: A Study in Selected Zones of SNNPR, Ethiopia
AU  - Yonas Sendaba
AU  - Tsegazeab Teklemariam
AU  - Daniel Balcha
AU  - Samson Wondimu
AU  - Tariku Lorato
Y1  - 2021/07/13
PY  - 2021
N1  - https://doi.org/10.11648/j.jfa.20210904.12
DO  - 10.11648/j.jfa.20210904.12
T2  - Journal of Finance and Accounting
JF  - Journal of Finance and Accounting
JO  - Journal of Finance and Accounting
SP  - 117
EP  - 126
PB  - Science Publishing Group
SN  - 2330-7323
UR  - https://doi.org/10.11648/j.jfa.20210904.12
AB  - Tax evasion is a phenomenon in every nation even if the magnitude and causes may vary. It is associated with the introduction of taxation itself; tax evasion is a serious problem to a tax system. Therefore, examining what contributes to evasion in a given tax system is vital so that the negative consequences might be identified and solved. The study sought to identifies determinant factors of taxes evasion attitude of taxpayers in selected five zones: Gedeo, Gamo, Hadiya, Halaba and Gurage zone of Southern Nations, Nationalities and Peoples Regions (SNNPR) Ethiopia. Using Yamane (1967) formula and sampled 956 respondents. We have categorized our respondents as evaders, non-evaders and neutral based on the average value of their response and exclude neutral respondents. Accordingly, we used 768 questionnaires. We used a logistic regression model to examine what determines the evasion attitude of taxpayers. It is identified that significant difference among taxpayers towards tax evasion at zone level; Category A taxpayers are inclined to evasion compared to B; the level of education, peer, tax rate, and tax system has contributed to tax evasion attitude positively; and Authorized accountants are found to be facilitators for evasion. Based on our result we concluded that system orients variables are the most determinant factors affecting the evasion attitude of taxpayers compared to demographic attributes.
VL  - 9
IS  - 4
ER  -

Copy | Download