FACTORS AFFECTING VALUE ADDED TAX (VAT) COLLECTION PERFORMANCE IN WOLDIA TOWN REVENUE OFFICE.

bstract Tax revenue is one of the fastest growing sectors of the economy in Ethiopia. Yet VAT revenue collection performance from this sector has continually been up and down for the last two years. This study was carried out to determine factors affecting VAT revenue collection performance of Woldia Revenue Office. Explanatory research design was applied to conduct this research. The target population for this study consisted of 500 tax payers of Woldia Revenue Office in Woldia Town Administration. Following the small size of the population of the study was used 222 tax payers by using Yamane formula. The study aimed at collecting both primary and secondary data; primary data were collected using a structured questionnaire while secondary data were obtained from annual reports. Descriptive statistics such as mean, frequency and percentages were used to analyze the collected data of the survey. Correlation analysis was run to determine the relationship between the dependent and independent variables. The results showed that all the variables had positive and statistically significant correlation with VAT collection performance. Regression analysis was used to measure and predict the effects of those predictor variables, namely, fraud evasion, gross domestic product, change of consumer behavior and enforcement on the criterion variable, VAT revenue collection performance of Woldia Revenue Office. The results of regression analysis portrayed that all predictor variables had no significant effects on VAT collection performance. This has implication how an organization should properly and consistently implement VAT administration policies to develop its consumer relationship strategy for the future, and to improve client loyalty as well as to positively impact the processes. the key words fraud evasion, gross domestic product, change of consumer behavior and enforcement on the criterion variable.