Assessing the awareness and knowledge level of value added tax among retailers in Cape Coast implications for tax compliance.

Abstract

This Study explores the extent of awareness and understanding among retailers in the Cape Coast Metropolis regarding Value Added Tax (VAT) and its Effect on tax compliance. Utilizing a sample size of 150 respondents and employing a descriptive research design, the study aims to evaluate retailers' awareness and comprehension of VAT, identify factors that influence this awareness, and examine how it affects tax compliance behaviors. The Finding reveals that retailers' awareness and knowledge levels of VAT are influenced by various factors. While formal education is a significant factor, other contributors include the accuracy of VAT information provided by the government, personal interactions with tax authorities, and communication within the market. These findings challenge the notion that awareness and knowledge of VAT are solely dependent on formal education, emphasizing the complex interplay of different factors in shaping retailers' understanding of VAT, which subsequently impacts their tax compliance practices. The moderate level of awareness observed among retailers highlights the need for targeted educational initiatives aimed at improving comprehension and compliance behaviors. Based on the key findings of the study regarding VAT awareness and its implications on tax compliance among retailers in the Cape Coast Metropolis, it was ascertained that Integrating VAT concepts into the formal education curriculum can lead to a long-term positive impact on tax compliance. By introducing students to VAT principles early on, they will develop an understanding of their tax obligations from the beginning of their business ventures. This foundational knowledge will shape their compliance behaviors as they transition into entrepreneurs.