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1. CENTRAL UNIVERSITY COLLEGE
ASSESSING THE CHALLENGES OF TAXATION REVENUE MOBILIZATION IN
GHANA AND THE WAY FORWARD – A CASE STUDY IN ASSIN NORTH
MUNICIPAL, ASSIN SOUTH DISTRICT, ABURA ASEBU KWAMANKESE
DISTRICT AND MFANTSIMAN MUNICIPAL ASSEMBLY IN THE CENTRAL
REGION OF GHANA.
BY
EMMANUEL AMPONG (ACC/11/01/2707)
A DISSERTATION SUBMITTED TO THE DEPARTMENT OF ACCOUNTING,
SCHOOL OF BUSINESS MANAGEMENT AND ADMINISTRATION, CENTRAL
UNIVERSITY COLLEGE, IN PARTIAL FULFILLMENT OF THE REQUIREMENTS
FOR THE AWARD OF BACHELOR OF SCIENCE IN ADMINISTRATION
(ACCOUNTING OPTION).
2015

2. DECLARATION
I hereby declare that this submission is my own work towards the BSC. Administration
(Accounting Option) and that, to the best of my knowledge, it contains no material
previously published by another person nor material which has been accepted for the award
of any other degree of the University, except where due acknowledgement has been made
in the text.
Emmanuel Ampong ................................... ..............................
Student Name Signature Date
Certified by:
Mr. Julius Aidoo- Buameh ................................... ..............................
Supervisor Signature Date

3. DEDICATION
I dedicate this work to my lovely family. My father Mr. Kojo Ampong and Madam Dora
Appiah (mother) for their contribution to bring my life this far. My lovely brothers Stephen
Ampong of G E S and Sylvester Ampong of University of Education, Wineaba cannot be
forgotten. I also dedicate it to Abigail Anancy of University of Cape Coast, Enyonam and
Rahinatu of Central University College for their encouragement. Sister Gifty Ampong,
Edith Ampong and Matrilda Ampong, Methodist Youth Fellowship members and Sunday
Children of Bereku Circuit.

4. ACKNOWLEDGEMENT
This dissertation would not have been completed without the invaluable support and help
of some people, all of whose names I cannot record here.
First, my profound gratitude goes to Mr. Julius Aidoo- Buameh, Head of the Accounting
Department of Central University College, under whose supervision this project was
written.
My gratitude also goes to Mr. Stephen Ampong G. E. S. Assin Akrofuom who helped me
in the administration of my questionnaires.
I would also like to express my sincere thanks to all the staff members of the Internal
Revenue Service in the Assemblies under review.
Finally, to all those who I have not mentioned, my colleagues and my family, I thank you
all for being there for me.
May the Father Almighty richly bless you all.

5. ABSTRACT
Tax leakage in developing countries is often worsened by poor functioning tax
authorities due to various reasons such as inadequate facilities, luck of trained
administrators, poor tax collection systems, luck of education on the part of some
Taxpayer, lack of motivation for Tax Collectors and lack of incentives.
These factors create opportunities for domestic and foreign entities to abuse the
system since tax official frequently lack the required technical skills to unravel complex
international fiscal structures that are used to escape taxation, and because penalties are
insufficient to stop tax evasion.
The main objective of this study is to assess the challenges of tax collectors in the
performance of their duties and the various challenges the Taxpayers go through in paying
their taxes and how they could be addressed.
Data for this study were collected using questionnaire and interviews which was
administered to some staff of the revenue institutions and professionals in the assemblies
under review.
The study proves the use of tax education and capacity building ginger tax and rate
payers as well as revenue collectors to live up to their civic responsibilities, tax systems
need to be efficient, Taxpayers need to be educated and workshop and seminars need to be
organized for Tax Collectors.

6. TABLE OF CONTENTS
CONTENT PAGE
Declaration i
Dedication ii
Acknowledgement iii
Abstract iv
Table of Content v
CHAPTER ONE- INTRODUCTION
Background of the study 1
Statement of Problem 4
Objective of the Study 5
Research Questions 6
Significant of the Study 7
Limitations 8
Scope of the Study 8
Research Methodology 9
Organization of the Study 9

7. CHAPTER TWO- LITERATURE REVIEW
Introduction 11
Historical Background of Taxation in Ghana 13
Definition of Taxation 15
The Role of Taxation in the National Economy 16
Tax Administration 18
Attribute of good Tax System 19
Nature of Tax 21
Impact, Incidence and Taxable Capacity 22
Income Tax Returns 23
Failure to furnish Returns 23
Effects of Tax Incentives on Revenue Mobilization 24
Advantages of Tax Incentives 25
Limitations of Tax Incentives 26
Type of Taxes 28
Income Liable to Tax 29
Exempt Income 29

8. Industry Concessions 32
Tax Avoidance 34
Tax Evasion 34
Efficiency and Effectiveness of Tax Systems 36
Ways to Enhance Tax Efficiency (The Way Forward) 38
CHAPTER THREE- RESEARCH METHODOLOGY
Introduction 42
Study Area 42
Research Design 43
Research Population 43
Sample Size 44
Sampling Technology 45
Sources of Data 45
Data Collection Tools 46
Data Analysis and Interpretation 47
CHAPTER FOUR- DATA ANALYSIS AND DISCUSSION OF RESULT

9. Introduction 48
Presentation and Analysis 48
Sex of the Respondents 48
Age of Respondents 49
Importance of Tax to the State 50
Effects of Taxes on Prices of Goods and Services 51
Exemption of Essential Goods from Taxes 52
Importance of Tax Education 53
Objective of Some Taxes in Ghana 54
Effective Medium Tax Education 56
Seminars and Workshops for Tax Collectors 57
Motivation for Tax Collectors 57
Adequate logistics for Tax Collectors 58
Registration and issuance of Tax Identification Number 59
Punishment for Tax Defaulters and Evaders 60
Filling of Tax Returns 61
Rate of Taxes in Ghana 62
Advantages of Tax Incentives 63

10. Efficiency of the Current Tax Collection in Ghana 63
Area the Government should increase Tax 64
CHAPTER FIVE- SUMMARY OF FINDINGS AND RECOMMENDATIONS
Introduction 66
Findings 66
Conclusion 68
Recommendations 68
REFFERENCES 70
APPENDIX 1 (Questioner for Taxpayers) 72
APPENDIX 2 (Questioner for Tax Collectors) 75

11. LIST OF TABLES
Penalties for Tax Offences 24
Incentives under the Income Tax Act 27
Population of the Assemblies under Review 42
Sex of the Respondents 48
Age of the Respondents 49

12. LIST OF FIGURES
Importance of tax to the state 51
Effect of taxes on prices of goods and services 51
Exemption of essential goods from taxes 53
Importance of tax education 53
Objective of some taxes in Ghana 54
Effective medium of tax education 56
Seminars and workshop for tax collectors 57
Motivation for tax collectors 58
Adequate logistics for tax collectors 59
Registration and issuance of tax identification number 60
Punishment for tax defaulters and evaders 60
Filing of tax returns 61
Rate of tax in Ghana 62
Advantages of tax incentive 63
Efficiency of the current tax collection in Ghana 64
Area the government should increase more of tax 65