Abstract:
Globally, governments' major revenues, and the countries' peace and security, are challenged by the
increasing nature of illegal border trade. Customs and border control agencies face key challenges in
preventing illicit trade and disrupting transnational smuggling operations those challenges: the scale
of complexity of physical transportation geography in border, evasion, structural and operational
flexibility by professional smugglers and cooperation problems which may arise inland and border
control. The illegal trade in smuggled goods deprives governments of tax revenue, when goods are
conveyed secretly or illicitly into or out of the country, without the payment of customs duty and tax.
The government is obliged to increase taxes due to the burden of covering these shortages falls on
honest taxpayers becomes weaken, the growth of black-markets, increase the price of domestically
produced and imported goods leads many consumers seek lower-priced goods.This study sought to
find out the challenges of control contraband trade on Ethiopian revenue and customs authority
Jimma branch. The study used a qualitative and quantitative research approaches and targeted all
population of 94 employees those who are working in law and enforcement department of the
organization by use census of the whole respondents. The primary data was collected from custom
profession by questionnaires developed in Linkert scale and interview to the management team. The
data was tested by applying Statistical package for social science version 20 analytical tools.
Cronbach’s alpha reliability test, frequencies, descriptive statistics, bivariate correlation analysis
(two-tailed) to show the relationship, liner regression to measure the effects of the independent
variables on the dependent variables and to find the coefficient of determination analysis to test the
models. The process of controlling contraband faces a great challenge like corruption, Lack of
formal trade agreement, lack of stability of Ethiopia and neighboring country, poor communication,
inadequate enforcement and penalties in the area. The thesis then suggests that to mitigate
contraband, the government should raise domestic innovations, manufacturing and development
stability, strengthen strong enforcement of the rules and punishments, and even create conducive
environment for effective coordination and communication among controlling unit.
