According to the response of the respondents, certain factors were found to be the main
constraints at Arada Sub City VAT administration. These were:- lack of well trained and
credible tax officials mainly in taxpayers identification and registration process; lack of
well trained officials to use SIGTAS (Standard Integrated Government Tax
Administration System) so not possible to know the exact number of active VAT
registrants, to identify and control non filers or stop filers using the computer system. In
addition; the office facilities and procedures are not supportive to comply for taxpayer
and tax officer, no audit plan based on risk assessment, weak enforcement, absence of
well organized taxpayers’ education and assistance program about VAT, poor refund
management and low voluntary compliance of taxpayers in the Sub City are the main
constraints. Finally based on the findings, possible solutions were given. These include;
improve taxpayer identification and registration, improve VAT collection, develop
planned auditing, establish effective enforcement mechanisms, and improve service
delivery, voluntary compliance of taxpayers and refund management.