Impact of Value Added Tax on Business Enterprises: A Case of Mettu Town

This paper summarizes the arguments and counterarguments within the scientific discussion on the issues of impact of value added tax on business enterprises. The main purpose of the research is to examine the impact of value addition tax on business enterprises in Ethiopia particularly in Mettu Town of Oromia region. The other specific objectives are to examine how value addition tax influences the private investment in enterprises, to examine the major other factors that are responsible for low business investment in Mettu town of Ethiopia. Systematization literary sources and approaches for solving the problem have widely been used that indicates that there is a contradictory scalier on impact of VAT on business entrepreneurship's investment in Ethiopia. The relevance of the decision of this scientific problem is that how implication of value addition tax affecting the business activities. Investigation of the topic mentioned above is carried out in the following logical sequence measuring value addition tax; expansion or contraction of business enterprises in Ethiopia. Methodological tools of the research methods were comparative analysis using statistical tools and techniques for the years of research 2017-18. The object of research is the regions specified systematically, because namely they were elaborated. The paper presents the results of an empirical analysis of impact of value addition tax on business enterprises, which showed that there is a contradictory paradox among parameters. The research empirically confirms and theoretically proves that the value addition tax has the partial impact on the investment in business enterprises and other factors are responsible for investment in business enterprises in Ethiopia. The results of the research can be useful for Policy maker, academicians and researchers.