Abstract:
This study aims to assess the impact of a cash register machine (Electronic Tax Registers (ETRs)) on value-added tax collection in Ambo Town. This study uses both qualitative and quantitative methods. The Study used cluster random sampling method to collect data and sps version 26 to analysis data collected.
Data were collected from the primary source through interviews and questionnaires. Questionnaires from this 215 were returned, Regarding to primary data, it obtained from structured questionnaire that were collected from 600 VAT registrants samples and 240 were distributed by using Yemane formula. These samples were selected by using cluster sampling techniques and 215 were collected questionnaires from VAT register and three coordinators and one manager, as key informant interviews, were interviewed. Data were analysed using SPSS version 26. Before analysing econometric models, the collected data were examined for normality, multicollinearity, and heteroscedasticity problems. The Results of the study showed that VAT collection performance was positively and significantly influenced by related factors such as awareness, penalty, and ETR at a 1% significance level in addition improved the efficiency and effectiveness of the Tax collectors. Econometrics approach has indicated that VAT collection performance was negative and not significantly influenced by administrative and compliance costs. However, ETR is negatively and significantly influenced by changes in evasion, suggesting that the Regional Revenue Bureau and Ministry of Revenue should raise awareness and penalties in society to use ETR Enhance Taxpayer Awareness: Implementing targeted educational programs to increase taxpayer awareness regarding VAT obligations and the benefits of compliance. Strengthening Penalty Enforcement: Establish stricter penalties for VAT evasion and ensure consistent enforcement to effectively deter non-compliance. Improve Administrative Processes: Address administrative inefficiencies that may hinder VAT collection and ensure streamlined operations within tax offices. Utilize Warnings Effectively: Develop a structured approach to issuing warnings to non-compliant taxpayers, emphasizing the consequences of continued evasion.. By implementing these recommendations, Ambo Town can enhance its VAT collection performance, leading to increased revenue and improved public service delivery.
Keywords: Value
