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Tax compliance attitude of rural farmers: an analysis based on survey data in Ethiopia

Agricultural Communications Documentation Center (ACDC)
Hassen Azime (main author), Gollagari Ramakrishna (author)
Book chapter
Publication Date:
Ethiopia: Springer
Agricultural Communications Documentation Center, Funk Library, University of Illinois
Subject Term:
attitudes, expenditures, farmer attitudes, farmers, government policies, knowledge, knowledge level, small farmers, farmer perspectives, transparency, Ethiopia (Africa, Eastern), governance, tax compliance
pgs. 137-158, Online ISBN: 978-981-10-8126-2, Online book chapter in Heshmati, H. and Yoon, H., Growth and Development in Ethiopia: Perspectives on Development in the Middle East and North Africa (MENA) Region, Springer, Singapore., Applying logit regression models, we present the factors that determine the tax compliance attitude of individual smallholder farmers in Ethiopia. The evidence presented in this article is based on the 5th Afrobarometer Survey (2014). We find some similarities and some differences with earlier studies in factors that are correlated with the tax compliance attitude of smallholder farmers in Ethiopia. We argue that tax compliance is a function of individual smallholder farmers and related variables and confirm that people who are happier with open administration arrangements have a tax compliant attitude. Those farmers who perceive that their ethnic group thinks that they have been treated unfairly are less likely to have a tax compliant attitude. Smallholder farmers’ tax knowledge is also significantly correlated with a tax compliant attitude in Ethiopia. We identify a taxpayer’s satisfaction with local government officials as another determinant of tax compliance. These findings are robust to different econometric specifications.