In Ethiopia the tax contribution to GDP ratio remained continuously low and is distinctly shrinking because of low tax compliance. Hence the general objective of the study was to examine the factors that affect voluntary tax compliance in category A and category B taxpayers in Bahir Dar city. Specifically, the study examined the effect of government trust, tax knowledge, fairness and equity on tax system, tax compliance cost and reward and incentives on voluntary tax compliance level in Bahir Dar city category A and B taxpayers. Quantitative research approach was used in this study to examine the relation between factor variables and tax compliance behavior. The target population of the study was category A and B taxpayers in Bahir Dar city, because of heterogeneous group of the study which is category A and B tax payers the researcher used stratified sampling technique. Primary data in the form of closed ended questionaries were distributed to 368 category A and B tax payers in Bahir Dar city and 302 were returned. The data were analyzed by using SPSS version 26 software in ordinary logit regression model. The result of descriptive statistics in the study shows that most of category A and B tax payers in Bahir Dar city were grouped in medium level of compliance. Additionally, outcome of odds ratio in the study tells that government trust, tax knowledge, fairness and equity on tax system and reward had a positive and significant effect on tax compliance behavior in Bahir Dar city category A and B tax payers. However, compliance cost had negative and significant effect on tax compliance level. To enhance the level of voluntary tax compliance government and tax authority should be accountable and transparent, the tax office should create awareness for taxpayers about tax in media, website and preparing of seminars. minimize compliance cost and provide material and non-material rewards for honest tax payers.