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Small Business Owners’ Perception On Value Added Tax Administration In Ghana: A Preliminary Study

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  • Salahudeen Saeed

Abstract

This paper examines Small Business Owners’ knowledge of Value Added Tax obligations to the Government of Ghana, their opinions on Ghana’s Value Added Tax system, and attitudes towards the payment of Value Added Tax. Based on a cross-sectional survey, the study employed a snowball sampling technique in selecting 328 respondents for the study. Simple percentages and frequency tables were employed for the data analysis. The paper shows that most Ghanaian small business owners do not understand their Value Added Tax obligations. There is also some willingness to evade Value Added Tax. Further, they view the tax as unfair. Moreover, results show that Ghanaians appear to have accepted the civic responsibility of Value Added Tax payment to the state. Equally important, the author demonstrates that Ghanaian small business owners do not understand the basic procedure in assessment, collection and enforcement of Value Added Taxes legally due the state.

Suggested Citation

  • Salahudeen Saeed, 2020. "Small Business Owners’ Perception On Value Added Tax Administration In Ghana: A Preliminary Study," Accounting & Taxation, The Institute for Business and Finance Research, vol. 12(1), pages 97-105.
    • Handle: RePEc:ibf:acttax:v:12:y:2020:i:1:p:97-105
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    References listed on IDEAS

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    1. James Andreoni & Brian Erard & Jonathan Feinstein, 1998. "Tax Compliance," Journal of Economic Literature, American Economic Association, vol. 36(2), pages 818-860, June.
    2. Adams, Caroline & Webley, Paul, 2001. "Small business owners' attitudes on VAT compliance in the UK," Journal of Economic Psychology, Elsevier, vol. 22(2), pages 195-216, April.
    3. Stephan Muehlbacher & Erich Kirchler, 2013. "Mental Accounting of Self-Employed Taxpayers: On the Mental Segregation of the Net Income and the Tax Due," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 69(4), pages 412-438, December.
    4. Olsen, Jerome & Kasper, Matthias & Kogler, Christoph & Muehlbacher, Stephan & Kirchler, Erich, 2019. "Mental accounting of income tax and value added tax among self-employed business owners," Journal of Economic Psychology, Elsevier, vol. 70(C), pages 125-139.
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    Cited by:

    1. Neba Bhalla & Rakesh Kumar Sharma & Inderjit Kaur, 2022. "Effect of Tax Knowledge and Technological Shift in Tax System on Business Performance: A PLS-SEM Analysis," Sustainability, MDPI, vol. 14(16), pages 1-18, August.
    2. Neba Bhalla & Rakesh Kumar Sharma & Inderjit Kaur, 2023. "Effect of Goods and Service Tax System on Business Performance of Micro, Small and Medium Enterprises," SAGE Open, , vol. 13(2), pages 21582440231, June.

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    More about this item

    Keywords

    Taxation; VAT Compliance; Tax Evasion; Tax Administration; Ghana;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General

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