Factors affecting fairness of taxation on category “a” tax payers: the case of hawassa city administration tabor sub city revenue authority office

Currently Ethiopia is in an era of renaissances and struggling to over -come her poverty. For Ethiopia Taxation is a weapon that support this struggle for this to happen a fair tax system is needed. The goal of this study is to investigate fairness of taxation on category “A” tax payers found in Hawasssa city administration Tabor sub-city Revenue authority. The researcher distributed questionnaires to selected tax payers and tax officers. In addition the researcher used in- depth interview and Focus group discussion with management bodies and Tax payers respectively. The objective of this study is to investigate the determinants of tax fairness among category “A” tax payers of Hawassa City Administration, Tabor Sub city. To this end the study conducted a cross-sectional study on a sample of 286tax payers using multistage sampling technique. The study also employed a probit model to identify determinants of tax fairness. Accordingly, the probit regression result of tax fairness reveled that four variables namely attitude of tax payers, corruption, tax system and license of trade are significantly rated with tax fairness. The findings show that fairness of taxation is directly and positively determined by attitude of tax payers and trade license. In addition to that tax fairness is also affected but negatively and significantly by corruption and tax system. The study concluded that tax fairness can be created and maintained through developing positive attitude of taxation among tax payers, ensuring that all businesses should operate under proper trade license, strengthening the tax system and combating with corruption on the part of revenue authority and tax administration staff.