Abstract:
The adverse situation in the various local government areas of Ambo Town Ethiopia has led the researcher to go into this very topic. Hence, the purpose of this work is to enlighten people, mostly students in the school of financial studies on how revenue generated in local governments, problems confronting them as regards revenue generation as well as prospects. The function of revenue generation is basic sources of economic engagement for the local government to offer economic, social and services provision for citizen. On the other hands, revenue generation in its unique behavior, independently clarify mandatory act to this organ to fulfil those provision for citizen and development desire of the populace. The aim of the study is to assess revenue generation and its challenges in local level, in Ambo Town, by employing qualitative and quantitative research methods. The study adopts the participant observation method and source data from the secondary sources. Sample of 200 were included in the study by employing purposive sampling technique and 176 questionnaires returned back then analyzed. The observation, focus group discussion and statistical analysis employed for study. Additionally, secondary data gathered from revenue authority and finance department with four-year internal collected revenue and regional transfer report, years from 2020/21 to 2022/23. The paper holds that the revenue collection without revenue independence, collection performance practice without best mechanism and absence of resource mobilization in studied way, lack of practice supporting revenue generation management, shortage of revenue collecting electronics infrastructure wide area network system, that have directly affect revenue generation. Based on this, the paper recommended among other that, local government, Ambo town Revenue Authority and respective body should commit to secure sustainable internal revenue generation, improve positively affecting factors, forward feedback to the area of complex tax laws to the concerned authority, and encourage taxpayers who good perform
