Assessment of the Challenges and Opportunities of Business House Rental Income Taxation in Regional State of Tigray

The prevalence of poverty in developing countries like Ethiopia demands improvising internal revenue generating projects particularly the tax administration to reduce dependence on foreign aid and borrowing. The main objective of the study was to assess the challenges and opportunities of Business House Rental income taxation in Regional state of Tigray. To achieve this objective, the researchers used both primary and secondary data. Primary data was collected through a survey questionnaire which was developed formerly for the sampled responders, focus group discussion, and oral interview conducted with the concerned officials, as well as personal observation by the investigators. In addition to this, secondary data was obtained from different sources such as documents, reports, and related research findings. The data gathered witnessed that there exist inefficiency and insufficient number of business house rent tax assessment and collection officers in the regional state of Tigray Finance and Economic Development Bureau. Moreover, most taxpayers lack sufficient knowledge of tax assessment and collection procedures. Thus, most of business house rent tax payers do not know the existing applicable rules and regulations. Due to this and other factors mentioned in the analysis of this study, negligence, delay in tax payment and evasion are taken by taxpayers as solution to escape from payment of proper business house rental income taxes. Despite the challenges/problems of business house rent income taxation discussed, there are clear policies and strategies, strong stand of the government over development, peace, and democracy, Economic growth of the country, good fighting spirit by the society against the tax evaders are some opportunities which ultimately results to the high amount of tax collection, if exploited properly.