Factors Affecting Rental Income Tax Payers Compliance with Tax System: In Case of Hawassa City Administration, Snnprs, Ethiopia

The main objective of the study was to assess rental income tax payer’s compliance with tax system in case of Hawassa city administration, SNNPRS. To achieve this objective, the researcher used both primary and secondary data. The collected data was analyzed by using the statistical software program namely Statistical Package for Social science (SPSS) version 20. The quantitative data was analyzed using descriptive statistics (frequency, percentage, mean and standard deviation) and a number of techniques of analysis were used including Reliability test, Correlation and Multiple Regressions. According to the response of the respondents, certain factors were found to be the major determinants of non residential house rental income tax payers’ voluntary compliance. These are: financial constraints, referent group influences, awareness of tax payers, perception on tax fairness, understatement of income, educational status, absence of government incentives, trust in tax assessment and collection procedure and rental tax audit. Based on the findings some possible recommendations were given. These include, building understanding of tax payers, upholding tax fairness and equity, constructing capacity of the tax authority, and providing required social services to the general public to get trust from society and critical follow up over tax payers those evade tax by their personal problem . Keywords: Rental income, Tax compliance, Tax system, Attitud