International Journal of Mechanical Engineering and Technology (IJMET)
Volume 10, Issue 04, April 2019, pp. 648–660, Article ID: IJMET_10_04_063
Available online at http://www.iaeme.com/ijmet/issues.asp?JType=IJMET&VType=10&IType=4
ISSN Print: 0976-6340 and ISSN Online: 0976-6359
© IAEME Publication
Scopus Indexed
ADOPTION OF ELECTRONIC TAXING SYSTEM
IN ETHIOPIA: REFLECTIONS OF BARRIERS
AND DRIVERS
Dr. B.C.M. Patnaik
Associate Professor, School of Management, KIIT University,
Bhubaneswar, Odisha, India
Dr. Ipseeta Satpathy
Professor, School of Management, KIIT University,
Bhubaneswar, Odisha, India
Mesele Kebede Manaye
Research scholar, School of Management, KIIT University,
Bhubaneswar, Odisha, India
ABSTRACT
The fact that taxation is essential for sustainable economic development and tax
administration is as basic function of a successful state makes tax authority to improve
its tax collection services and make tax administration more effective. The study
investigated the adoption of E-taxing by tax revenue authorities in Ethiopia regarding
the barriers which can affect the authorities from taking advantage of E-taxing system
and anticipated benefits derived by adopting the system. The study was carried on the
data collected from tax revenue authorities in Ethiopia especially in Wolaita Sodo
town tax revenue authority. Purposive sampling method was applied to draw the
sample from the target one. A mixed research approach was used to answer the
research questions that appear through the review of existing literature and the
experiences of the researcher in respect of the E-taxing system in Ethiopia. The study
statistically analyzed data received from the survey questionnaire and interview. The
result of the study indicated that, the major barriers of Ethiopian taxing authorities
faces in the adoption of Electronic taxing are, frequent power interruption, tax payers
low levels of computer literacy, lack of sufficient government support affect tax payers
willingness lack of uniform platform by tax authorities for adoption and growth of Etaxing technology in Ethiopia, lack of skilled manpower exist in tax revenue
authorities, limitation in network infrastructure. Lack of enough coordination,
interaction and cooperation between tax revenue authorities and other decision
making/like ETC and EELPA/ centers in e-taxing context and lack of legal framework
for e-taxing for implementation and growth of E-taxing technology in Ethiopia and the
benefits are E-taxing to improve customer service and satisfaction-taxing wish to
satisfy rapid change of customer/tax payers need and preference, E-taxing to improve
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the relationship with customer and E-taxing to cover wide geographical area for the
development of E-taxing technology, increases productivity of the tax revenue
authorities decrease the work load of makers, reduces paper work and HR
requirement and enhance productivity in the taxing authorities as a driver of adopting
and developing E-taxing system in Ethiopia. The study recommends sequence
measurement which could be taken by all tax revenue authorities staff and
management body creates collaboration with the respective government organ for the
development of E-taxing Technology by investing on ICT infrastructure, set clear
direction and focused on technological innovation for the Globalization of the
country.
Key words: Adoption, E-taxing technology, Barriers, Drivers, tax revenue authorities
Cite this Article: Dr. B.C.M. Patnaik, Dr. Ipseeta Satpathy, Mesele Kebede Manaye,
Adoption of Electronic Taxing System in Ethiopia: Reflections of Barriers and
Drivers, International Journal of Mechanical Engineering and Technology 10(4),
2019, pp. 648–660.
http://www.iaeme.com/IJMET/issues.asp?JType=IJMET&VType=10&IType=4
1. INTRODUCTION
Technology is making a tremendous impact upon service companies in general and the
financial services sector is no exception. The application of information and communication
technology concepts, techniques, policies and implementation strategies to taxing services has
become a subject of fundamentals importance and concerns to all taxing authorities and
indeed a prerequisite for local and global competitiveness in taxing authorities. As a result of
this technological improvement business environment in taxing authorities is extremely
dynamic and experience rapid changes and demands taxing authorities to serve their
customers electronically (2016. Worku G, et al.)
Like all other social entities taxing authorities are being constantly shaken by
technological innovations and inventions (Shyamapada etal., 2011). For instance, till now
taxing authorities clients were used to stand in line to get financial services, but now because
of the development of the Information and Communication Technology (ICT) and
introduction of electronic taxing services they can perform it at any-time from anywhere even
from home. although the goal of any taxing authority is to establish a system of tax
administration that allows for the collection of required taxes at minimum cost, most
developing countries government taxing departments are characterized by a lot of paper work,
long ques, bureaucracy, cramped spaces and a lot of frustrations. With growing demands of
citizens and changing global rules and regulations, governments are under pressure to deliver
services at the right time and quality. The desire to easy administrative duties and services
offered to citizens is a goal every government. Simplicity can be realized through the use of
ICTs like that of electronic filing system (Mutula ,2012).
Even though , in most developing countries manual filing still remains the traditional and
most wide spread method of submitting tax returns for government revenue services, the
world advancing in technology, has made things easily done electronically. A web technology
is becoming more and more popular, the introduction of internet filing has brought
fundamental changes to the methods of filing tax returns (Hwang,2000).
As for Ethiopia, in February 2013, the Ethiopian revenue and customs authority (ERCA)
has brought significant benefits to the business community and Ethiopia's wider economy by
developing e-tax system. This system makes taxpayers able to submit their tax returns
electronically to the tax authorities and it is believed to improve the delivery of public
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Adoption of Electronic Taxing System in Ethiopia: Reflections of Barriers and Drivers
services and the dissemination of public administration information to the public.(Anna &
Yusinza,2009). A tax authority engages in many activities, such as processing returns and
related information's from tax payers', entering tax return data in to a data base, matching
returns against filing requirements, processing tax payments and matching them against
assessments, and issuing assessments and refunds. One way of assessing the tax authorities
efficiencies is by expanding its use of information and communication technology (ICT).
Such technology can facilitate a broad range of services, including registering tax payers,
filing returns, processing payments, issuing assessments and checking against third-party
information.(Clarke,2001).
Tax system in developing countries face both new challenges and new possibilities as a
result of new technological change. ERCA's introduction of electronic taxing system is no
exception. Since electronic taxing is relatively new system, there are few studies focusing on
the challenge, benefit and effect of electronic taxing. hence, the main aim of this research is to
investigate what challenges Ethiopian revenues and custom authority(ERCA) is dealing with,
the benefits of implementing e-taxing and the challenges of adopting it.
2. OBJECTIVES OF THE STUDY
2.1. General Objective
The main objective of the study is to assess and identify the barriers and drivers of adoption
of E-taxing technology in Ethiopian tax revenue authorities.
Specific Objectives
The specific objectives of the study developed are as follows:

To evaluate the barriers found in the adoption of E-taxing system in Ethiopia by tax revenue
authorities and what goes on practically in tax revenue authorities

To find benefits earned by the tax revenue authorities by using various delivery channels.

To examine the challenges that faced by the tax revenue authorities in adopting E-taxing
system

To identify the major tests and prospects of E-taxing technology in relation to Service delivery
quality of E-taxing.
2.2. Research Questions
Based on the above stated objectives, the following research question will be answered at the
end of this research.
These are:

What is the barrier for the adoption and growth of E-taxing technology in Ethiopia by tax
revenue authorities?

What are the benefits earned in Ethiopia by tax revenue authorities in the adoption of E-taxing
technology?

What are the driving forces towards the adoption and development of E-taxing technology in
Ethiopia by tax revenue authorities?

What possible involvements will be undertaken by the government to encourage the
development of E-taxing technology?

What kind of guidelines present in tax revenue authorities for effective control and
management of E-taxing service?
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2.3. Scope of the Study
The study was limited to surveying, interviewing and documentary analysis of the tax revenue
authorities especially Wolaita sodo town tax revenue authority, in Ethiopia. Wolaita sodo
town is selected on the basis of the familiarity with the e-taxing i.e. long year‟s services in
providing various types of E-taxing services to public. The study is also seeing whether or not
the usage is related to age, educational status and occupation. Last but not least the study was
seeing do tax payer‟s know about what e-taxing means and how they see the barriers and
drivers of E-taxing in the town.
3. RESEARCH METHODOLOGY
3.1. Introduction
This section introduces the detail methodology, showing the logical frame work that applied
to solve the research problem and answer the research questions commences with research
purpose, research approaches, research strategy including study area and type of data,
research method including survey design, sample design, method of data collection
(questioner and interview) and data analysis will be presented.
3.2. Research design
This study was interested on describing the current situation of the problem and answer the
research questions which are in the form of „„what‟‟, and to highlight the most important
factors that can negatively or positively affect the adoption and development of E-taxing in
Ethiopia. Moreover, this research was aims to explain the phenomenon and assess the current
practice of E-taxing. Therefore, Descriptive research will be used to achieve the research
objectives.
3.3. Types of Data
In this study both primary and secondary data sources to be used. Primary data collected
through, interviews, and questionnaires. This gives specific responses to the research
questions. Primary data is recognized as data is gathered for a specific research in response to
a particular problem through interviews and questionnaires. Secondary data was obtained by
examining various documents, including, the authorities annual reports, local and
international newspaper related with issues of e-taxing system, research reports, books and
journal articles.
3.4. Sample Design
Sampling is the process of choosing, from a much large population, a group about which wish
to make generalized statements so that the selected part represent the total group (Leedy,
1989). The correctness of any sample design story can be evaluated only in the context of the
overall study objectives. The important of the study is to be aware of the possible drivers and
benefits of the options and evaluate them in terms of the main purpose of the study.
3.5. Research participants
According to Ethiopian revenues and customs authority (ERCA), there are different
departments which deal with the e-taxing, data encoding, customer services and general
administration. Those tax revenue authorities that are taken as a sample from the total 183
employee of three sub town administration tax revenue authorities select 142 clerical Staff
including e-tax officers, managerial and administrative (supervisors), data encoding officers
and customer service officers from three sub town administration tax revenue authorities. The
procedure used for drawing the sample from the population is established on their familiarity
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with technological innovation. The questionnaires were circulated to all targeted groups of
employees of three sub town administration tax revenue authorities in Wolaita sodo town, and
the sample size for self-administered questionnaires was 142 employees.
Table 1 Total no of population
No
1
2
3
Tax revenue
branch office
Arada kifle
ketema
Mehal kifle
ketema
Merkato kifle
ketema
Total
Percentage
e-tax
officers
Data
encoding
officers
12
Customer
service
officers
8
Total
13
Managerial and
administrative
(supervisors)
15
12
11
15
9
47
16
12
11
8
47
41
28.5%
38
26.5%
38
26.8%
25
17.8%
142
100%
48
3.6. Method of data collection
In order to collect adequate data that is answer the research questions, researcher designed
two surveys; the first is a questionnaire to get quantified results. The second survey is
interviews aimed to collect data from E-payment/IT managers in CBE district office. In
addition to questionnaire and interview, data collected from different published and
unpublished materials will be used.
3.7. Method of data Analysis
The researcher was analyzed the data collected through survey to statistical population
concerning the practice of E-taxing system. The data which was be collected via
questionnaires were analyzed with descriptive statistics using Statistical Package for Social
Science(SPSS) version 20.The result of the analysis was summarized by:-Tabulation: the data
arranged in table format that impressing adoption and development of electronic taxing in
Ethiopia,-Measure of Central tendency -Frequency table along with Percentages, mean, mode
values and finally the data that was collected from the interview were interpreted qualitatively
these were used to ensure easy understanding of the analyses.
4. RESULTS AND DISCUSSION
Analysis and discussion on potential disputes that affect the adoption and
development of e-taxing technologies
Organizational Factors
Table 2 Organization Factors Affecting Adoption and Growth of E-Taxing
lack of customer
lack of technical and
high cost of
resistance to changes
awareness with e-taxing managerial skill in
implementation of in technology among
product
implementation and e-taxing(such as cost of by management, IT
development of eICT equipment and
support and staff
taxing technology network, software and
reorganization
N
Valid
132
132
132
132
Missing
0
0
0
0
Mean
3.9848
3.4924
3.6591
3.6364
Mode
4.00
4.00
4.00
5.00
Std. Deviation
1.01879
1.23249
1.08304
1.47381
source: survey result, 2019
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As shown in the table 2, most of the respondent agreed that lack of technical and
managerial skill in implementation and development of e-taxing services provided by tax
revenue authorities, résistance to changes in technology among by management, IT support
and staff and high cost of implementation of e-taxing (such as cost of ICT equipment and
network, software and reorganization considered as a factor that negatively affecting the
successful adoption and growth of E-taxing technology as the average result in the Likert
scale is found 3.49 and 3.64 and 3.66 respectively. Similarly, an interview script received
from expert of E-taxing and tax revenue authority manager indicates that communities are
not aware of the benefits of e-taxing technology to the individual as well as to the society as
whole. As a result, they are not aggravated enough to use E-taxing products or services. The
finding is in line with Vaithianathan, S. (2010) and Angelakopoulos and Mihiotis (2011) in
which all indicated that, the non- familiarity with E-taxing technology products and services
by customers and is the main factor that has a negative influence on the adoption and growth
of E-taxing technology. The result further exposed that most respondents were agreed that
lack of technical and managerial skills in implementation and development of E-taxing
technology is considered as factor that has a negative influence on the adoption and growth of
E-taxing technology in Ethiopia with a mean score of 3.49.
The respondents also agreed that resistance to changes in technology by Management, IT
supporter and staff is considered as a barrier for the adoption and growth of E-taxing
technology as the average result in the Likerts scale is found 3.64.
In general, the result discovered that lack of technical and managerial skills in
implementation and development of E-taxing technology, resistance to changes in technology
by management IT supporter and staff, high cost of implementation of e-taxing and lack of
customer awareness are considered as organizational factors that blocks Ethiopia tax revenue
authorities to adopt and develop E-taxing technology from time to time.
Table 3 Environmental Factors Affecting Adoption and Growth of E-TAXING
Barriers
lack of sufficient government
support affect
customer willingness
lack of legal framework for e-taxing
cross country legal and regulatory
difference will have impact on the
adoption of new technological
innovation in the tax revenue
authorities
lack of skill manpower exist in tax
revenue authorities
limitation in network infrastructure
and internet related support service
Customer/tax payers low levels of
computer literacy
limitation in ICT infrastructure
lack of enough coordination,
integration and cooperation between
tax revenue authorities and other
decision making/like ETC and
EELPA/ centers in e-taxing context
absence of financial network that
links different banks
frequent power interruption
N
Valid
132
N
missed
0
mean
median
4.3
5
Standard
deviation
.748
132
132
0
0
3.92
3.75
5
4
1.00
1.30
132
0
3.9
4.00
1.07
132
0
4.06
4
.91
132
0
4.34
4
.60
132
132
0
0
4
4.11
4
5
.96
1.04
132
0
3.97
4
.92
132
0
4.55
5
.58
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tight foreign currency regulation
132
lack of uniform platform by tax
132
revenue authorities i.e. lack of law
mandating the tax revenue
authorities to use common software
platform
devote high cost of internet
132
Source: From Own survey and questioner,2019
0
0
4.06
4.20
4
5
1.01
1.22
0
3.71
5
1.23
5. ENVIRONMENTAL FACTORS
The result of survey presented in the above table 3, frequent power interruption, customers/tax
payers low levels of computer literacy ,lack of sufficient government support affect customer
willingness and lack of uniform platform by tax revenue authorities are the basic external
challenge for adoption and growth of E- taxing technology in Ethiopia, were the mean and
median value are 4.55, 4.34, 4.3, 4.20 and 5.00, respectively as per the response of the
sampled participants. Likewise, an interview carried with managers and experts of tax
revenue authority indicates that lack of skilled manpower exist in the authorities ,limitation
in network infrastructure and internet related support services is a major obstacle to
effectively deliver of E-taxing services to their client.
The participants also agreed on lack of enough coordination, integration and cooperation
between tax revenue authorities and other decision making/like ETC and EELPA/ centers in
e-taxing context and lack of legal framework for e-taxing for implementation and growth of
E-taxing technology in Ethiopia in which the mean score was found 4.11 and 3.92. For
citizens to fully enjoy the benefits of E-taxing, they should not only know how to read and
write but also create awareness and made a campaign each sector from all private and public
banks.
5.1. Technological Factors
Even though there are many benefits related with adoption of new technology, also lots of
interruption affect technological factors that effectively and efficiently growth of the
technology. The issues raised here in under the technological factors were relative
disadvantages that hinder the tax revenue authorities from adoption and development of Etaxing technology such as lack of assurance with the security aspect, loss of the audit trail,
money laundering and other financial crime facilitated through e-taxing, users do not trust the
e-taxing technology provide by tax revenue authorities and the tax revenue authorities client
fear of risk all of the respondents participated in this study were asked that such factors are
consider as challenges that the banks faced while adopting and developing of E-taxing
technology in Ethiopia.
Table 4 Technological Factors Affecting Adoption and Growth of E-taxing system
Barriers
lack of assurance with
the security aspect
Valid
N
Miss- ing
Mean
Mode
Std. Deviation
Source: survey result,2019
132
0
4.3636
4.00
.56989
loss of
audit
trial
money laundering users do not trust the client fear of
and other financial e- taxing technology risk to use ecrimes easily
provided by the
taxing
facilitated through e- revenue authority
technology
taxing
132
132
132
132
0
0
0
0
3.6742
3.7197
3.9394
4.5000
4.00
4.00
5.00
4.00a
1.16891
1.33259
1.31206
.50190
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As indicated in the above table 4, shows that lack of assurance with the security aspect
and client fear of risk to use E-taxing technology the respondents provided by tax revenue
authority and the result gives mean value of 4.50 and 4.36 that means the largest number of
respondent (39.4% strongly agree and 59.1% agree and 50% strongly agree and 50% agree)
were agreed with the idea that lack of assurance with the security aspect and client fear of risk
to use e-taxing technology is one of technological factor that have a negative impression for
adoption and growth of E-taxing technology.
The result further revealed that the largest number of respondents were agreed with the
idea that loss of audit trial on E-taxing technology is considered as a barriers for the adoption
and growth of E-taxing technology in Ethiopia tax revenue authority, were mean and mode
value found 3.67 and 4.00, respectively. Also, money laundering and other financial crimes
easily facilitated through e-taxing is considered as another challenge for the adoption and
development of E-taxing technology were mean score and mode value gives 3.72 and 4.00,
respectively.
Benefits Earned From The Adoption And Development Of E-Taxing Technology In
Ethiopia Tax Revenue Authorities
Any technological innovations provide a lot of benefits to the users and service providers as
well. Since E-taxing is one of new technologies that are used by tax revenue authorities to
facilitate various types of payments, it provides a lot of benefits to the tax revenue authorities
and customers/tax payers than traditional system.
Benefits are the gains or improvements derived from existing traditional ways of
operating business transactions using E-taxing technology applications.
The following section summarizes respondents‟ views of prospects and comprehended
benefits for E-taxing deployment. Benefits required to be gained from E-taxing as an option is
a big deciding factor for a tax revenue authorities‟ decision to adoption and growth E-taxing
technology.
Some of these benefits include facilitate development of new products and new business,
improvement productivity, cost saving, increased market share by collecting commission and
built image , speed and efficiency of doing business, improvement in customer service and
satisfaction and others. In this study this benefit is divided by operational benefits and service
benefits.
5.2. Operational Benefits
Almost all of the respondents Strongly agree and agree only earn the benefit from tax revenue
authorities by operation the result give a percentage range of 69.7 up to 37.10% strongly agree
and agree.
Table 5: Operational Benefits the tax revenue authorities grasped from E-taxing services
Valid
N
Missi ng
Mean
Mode
Std. Deviation
reduced minimize
enhance
pa- per transaction productivity in
work and
cost
the tax revenue
HR
authorities
requireme
nt
132
132
132
0
0
0
4.6288
4.4848
4.6288
5.00
4.00
5.00
.48497
.50167
.48497
enhance
Decrease the
increase
foreign
work load of the reliability and
currency
employee
reducing
generation
error
132
0
4.4848
5.00
.65946
132
0
4.6970
5.00
.46132
132
0
4.4470
4.00
.49907
Source: From Own Survey, 2019
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The operational benefits of E-taxing technology as sensed by the tax revenue authorities
named in this study as caught in the above table 5, most of the respondents strongly agreed
and agree on average that adoption and development of E-taxing technology in Ethiopia
banking industry will increases productivity of the tax revenue authorities, decrease the work
load of makers, reduces paper work and HR requirement and enhance productivity in the tax
revenue authorities. This is proved by the data collected from the respondents with mean and
mode score of 4.70, 4.62, 4.62 and 5.00 respectively. This agreement is also founded on the
responses of the respondents with mean score of 4.45.
6. SERVICES BENEFITS
Table 6: Service Benefits of E-taxing technology
Service Benefits
Facilitates development of new product
and business in the tax revenue
authorities
E-taxing is convenient, in terms of 7x24
hour service i.e. accessibility, no time
limit to access tax revenue authorities a/c
and information
Enhance accessibility of the tax revenue
authorities
service in terms of place
Increase service quality
Improve operational efficiency
Improving transaction speeds
Reduce queues in the tax revenue
authorities hall
Facilitate marketing and market
access
Create better relationship among
tax revenue authorities and clients
Encourage price transparency
Number of Valid
respondent
132
Missing
value
0
Mean
Mode
Std. deviation
4.55
5
.50
132
0
4.50
4
.50
132
0
4.50
4
.50
132
132
132
132
0
0
0
0
4.44
4.54
4.55
4.41
4
5
5
5
.50
.50
.50
.81
132
0
4.20
5
1.05
132
0
4.64
5
.53
132
0
4.49
4
.50
Source: own survey,2019
The above table 6 , shows that most of the respondents range from 65.2 to 56.1 % have
strongly agreed and agreed on the matter that using E-taxing services provided by all tax
revenue authorities have saved their time. On other hand, on facilitate marketing and market
access 12.1 percent of respondents disagreed and10.6 percent are neutral. The result in short
describe that the use of E-taxing services has benefited to customers in terms of saving their
time. In addition, to this benefit involved towards availability, E-taxing increase customer
base as per the interviewee, built image for tax revenue authorities and created globalization
for country as a whole.
7. DRIVING FORCES ON THE ADOPTION OF E-TAXING SERVICE
Table 7: Driving forces that start the adoption of E-banking services
Driving Forces
E-taxing to improve organizational performance and
productivity
E-taxing to improve the relationship with
customer
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No of Valid
respondent
132
missing
Mean
Mode
0
4.37
4
Std.
deviation
.48
132
0
4.48
4
.50
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E-taxing to cover wide geographical area
E-taxing built organizational reputation
E-banking to reduce transaction cost
E-taxing to improve customer service and
satisfaction
Presence of high competition in the taxing
industry
E-taxing wish to satisfy rapid change of
customer need and preference
E-taxing uses legal frame works that apply tax
revenue authorities to adopt technological innovation
Source: Own survey,2019
132
132
132
132
0
0
0
0
4.47
4.41
4.43
4.53
4
4
4
5
.50
.49
.49
.50
132
0
4.35
4
.49
132
0
4.49
4
.50
132
0
4.15
4
.93
There are so many factors affecting adoption of E-taxing technology products in tax
revenue authorities. As depicted in the above Table 7 indicated that most of the respondents
strongly agreed and agree for answering the questioner that E-taxing to improve customer
service and satisfaction, E-taxing wish to satisfy rapid change of customer need and
preference, E-taxing to improve the relationship with customer and E-taxing to cover wide
geographical area for the development of E- taxing technology, in which the result of mean
score are founded 4.53, 4.49, 4.48 and 4.47 respectively. This is evidenced by the data
collected from the respondents.
7.1. Existing Opportunity in the country that initiate the adoption and
development of taxing technology
The availability of factors influencing banks to adopt E-taxing system is considered in this
research as opportunities. The existence of some difference among the respondent of each tax
revenue authorities regarding the different existing opportunities in the country for the
adoption of e-taxing.
But, to be benefited from late adopter opportunity, commitment of government to strength
the tax revenue authorities ,the presence of high demand, improvement in the taxing practice
of the society, assurance of the government to facilitate the development of ICT infrastructure
and willingness among tax revenue authorities to cooperate in building infrastructure are
common to all tax revenue authorities. In addition, the commitment of the government to
strengthen the tax revenue authorities is a good opportunity for the adoption of e-taxing
service in the country.
Table 8 Opportunities for Adoption and development of E-taxing technology by tax revenue
authorities in Ethiopia
To be benefited commitment of the presence of improvement assurance
from late adopter gov't to strength high demand in the taxing of the gov't
opportunity
the tax revenue
practice of the to facilitate
authorities
society
the
developme
nt of ICT
infrastruct
ure
N
Valid
132
132
132
132
132
Missing
0
0
0
0
0
Mean
4.3409
4.3788
3.6818
4.0152
4.2348
Mode
4.00
4.00
5.00
5.00
4.00
Std. Deviation
.57730
.50237
1.31531
1.20422
.65218
Source: survey result 2019
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Adoption of Electronic Taxing System in Ethiopia: Reflections of Barriers and Drivers
Accordingly, the sampled respondents agreed with the cognition that, to strengthen the tax
revenue authorities, to be benefited late adopter opportunity of E-taxing in Ethiopia tax
revenue authorities, assurance of the government to facilitate the expansion of ICT
infrastructure , to improvement in the taxing practice of the society and the existence of high
customers demand are existing opportunities furthering the adoption and development of Etaxing technology by tax revenue authorities in Ethiopia. This is evidenced by the data
collected from the respondents with mean score of 4.37, 4.34, 4.23, 4.01 and 3.68,
respectively.
8. CONCLUSIONS AND RECOMMENDATIONS
8.1. Conclusions
Certainly the tax revenue authorities in Ethiopia is underdeveloped and therefore there is an
all immediate need to embark on capacity building arrangements and modernize the taxing
system by employing the state of the art technology being used anywhere in the world. With a
growing number of import- export businesses, and increased international trades and
international relations, the current taxing system is short of providing efficient and dependable
services and therefore all tax revenue authorities operating in Ethiopia should recognize the
need for introducing electronic taxing system to satisfy their customers and meet the
requirements of rapidly expanding domestic and international trades, and increasing
international taxing services. Low level of internet insight and poorly developed
telecommunication infrastructure, lack of suitable legal and regulatory framework for ecommerce and e-payment, high rates of illiteracy, high cost of Internet, absence of financial
networks that links different tax revenue authorities, lack of reliable power supply, and Cyber
security issues are the most important challenges for development of e-taxing in Ethiopia.
8.2. Recommendations
Based on the above conclusion, the researcher has recommended the following points:

In order to adopt and further expand E-taxing technology, all tax revenue authorities have to
fully utilize opportunities, which are available in the country, through incorporating in
business plan of the tax revenue authorities and should develop awareness raising program to
its customers (society) on benefits of E-taxing relating with traditional system,

All tax revenue authorities should focus on informing customers/tax payers (who are using
only manual system) the benefit of using E-taxing by using medias in order to solve
challenges related with resistance to changes in technology by tax payers.

The government should support the tax revenue authorities by developing ICT infrastructure
to fill the need of growing customers and establish strong legal framework on use of E-taxing
services for successfully adopt the technology.

Government should support tax revenue authorities by facilitating development of sufficient
ICT infrastructure for the successful implementation and development of E-taxing services.

The tax revenue authorities should facilitated proper and continuous training courses for their
employees to have adequate understanding of the E-taxing technology so as to achieve the
desired point.

In collaboration with tax revenue authorities, Government should make a campaign and
inform the community on the work ability and effectiveness of E-taxing technology.

The government should make also a campaign at university for students on the benefits of Etaxing technologies so as to create cashless society in the future.
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Dr. B.C.M. Patnaik, Dr. Ipseeta Satpathy, Mesele Kebede Manaye

The Ethiopian revenue and customs authority (ERCA) should issue desirable legal
frameworks and in force all tax revenue authorities for adoption of the E-taxing technology.
DIRECTION FOR FUTURE RESEARCH
This study identified the main barriers and drivers of adopting E-taxing technology in Ethiopia by
tax revenue authorities, especially in Wolaita Sodo town, from the tax revenue authorities‟
point of view. However, it did not see the customers/tax payers‟ position and other
stakeholder like ETC, EELPA.
Hence, the researcher would like to advocate further research be made on the area
especially to catch the customers‟ point of view and the above stakeholders.
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