Exploring the Drivers of Voluntary Tax Compliance in Ethiopia
An Application of the Deterrence Theory and Slippery Slope Framework
Bibliographic Data
| ID | 22006199 |
|---|---|
| Authors | Sintayehu Assefa Yirga (0000-0002-1193-5974, Hawassa University, corresponding author) |
| Year | 2026 |
| Volume | 16 |
| Issue | 2 |
| Publication date | 2026-04-01 |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | SAGE Open (JOURNAL) |
| Journal identifiers | ISSN: 2158-2440 • E-ISSN: 2158-2440 |
| Publisher | SAGE Publications (PUBLISHER • US) |
| DOI | 10.1177/21582440261458417 |
| OpenAlex | W7165756705 |
| Language | EN |
| References cited | 47 |
This study investigates the key determinants of voluntary tax compliance among Category “A” taxpayers in Hawassa City, Ethiopia, with a particular focus on the mediating role of public trust. Drawing on the Slippery Slope Framework and Deterrence Theory, the research examines how economic, psychological, cultural, and institutional factors shape taxpayers’ willingness to comply. Data were collected from 308 businesses using structured surveys, and the analysis employed structural equation modeling to test direct and indirect relationships. The findings reveal that while institutional and cultural factors have strong direct effects on compliance, economic, and psychological factors influence behavior indirectly through public trust. Public trust emerges as a critical mechanism, translating perceptions of fairness, transparency, and accountability into voluntary compliance. The study highlights the importance of designing tax policies that not only ensure enforcement but also build confidence in government institutions. Policy implications include enhancing transparency, leveraging local cultural networks, linking tax payments to visible public services, and tailoring outreach strategies to different demographic groups. By emphasizing trust-building alongside effective administration, the study provides actionable insights for fostering sustainable voluntary tax compliance in developing-country contexts
Accountability · Deterrence theory · Enforcement · Incentive · Payment · Perception · Slippery slope · Structural equation modeling · Corporate Taxation and Avoidance · Microfinance and Financial Inclusion · Taxation and Compliance Studies
Defiance in Taxation and Governance
What Motivates Tax Compliance?
Income tax evasion
A new criterion for assessing discriminant validity in variance-based structural equation modeling
When to use and how to report the results of PLS-SEM
Common Method Bias in PLS-SEM
Social Norms Moderate the Effect of Tax System on Tax Evasion
Tax compliance and non-deterrence approach
Perceptions of trust and power are associated with tax compliance
The Effect of Citizens’ Perception of Governance on Tax Compliance
Tax compliance across sociodemographic categories
Power, justice, and trust
Enforced versus voluntary tax compliance
Culture differences and tax morale in the United States and in Europe
Sex differences in tax compliance
| Highly cited | No |
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