Determinants of Tax Compliance: A case study of Vat Flat Rate Scheme Traders in the Accra Metropolis

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Taxation is one of the important elements in managing national income, especially in developed countries and has played an important role in civilized societies since their birth thousands years ago. Tax compliance is an important issue in every economy recognizing the role revenue from tax play in national development. This study aimed at investigating the tax compliance level among traders in the Accra Metropolis and to determine the factors that influence tax compliance among traders. Data was gathered by interviews with the use of structured questionnaires and interview guides. Tables, graphs and charts were used to present the result of the analysis. Logistic regression model was used to determine the factors that influence tax compliance. Simplicity of tax returns and administration has positive and significant relationship with VAT compliance (p= 0.0001). The results also indicate that tax education also has a positive and significant relation with VAT compliance (p=0.0023). This study contributes to current global literature in this field of the relative importance of tax knowledge in affecting tax compliance, as well as exploring the factors that make people pay taxes, and discusses methods of increasing tax compliance among traders.
A Thesis submitted to the Institute of Distance Learning, Kwame Nkrumah University of Science and Technology in partial fulfillment of the requirements for the degree of Commonwealth Executive Masters in Business Administration