An Assessment of Gift Tax Admnistration in Ghana: A Case Study of Non-Accounting Postgraduate Students of Ghana

Abstract

The study sought to first examine the levels of gift tax awareness and the level of compliance of gift tax among graduate non-accounting students in Ghana. The study also examined factors that influence gift tax compliance in Ghana and also factors that influence effectiveness of tax administration system in Ghana for gift tax. The study sampled 125 graduate non-accounting students from the University of Ghana. The study used descriptive statistics, charts and diagrams, ANOVA and well as regression analysis to achieve the objectives of the study. The results showed low of gift tax awareness among graduate non-accounting students with none of the respondent ever paying taxes on their gifts even though majority admitted receiving gifts. Though the tax administrators perceive the awareness level to be high, the result of the study indicates otherwise. Some of the reasons identified by the study for the low level of compliance with gift tax among Ghanaian taxpayers are: unawareness of gift tax obligations, those taxpayers who are aware do not feel obliged to pay; the non-enforcement by the tax officials; some taxpayers simply never receive taxable gifts; or the value of the gift is not above the exempt threshold. The results also showed the gender, age and work experience affect gift tax compliance. Finally, on the effectiveness of gift tax administration system in Ghana, the study found that simplicity, equity, transparency and administrability were significant determinants of tax system effectiveness in Ghana. It is recommended based on the findings of the study that Ghana Revenue Authority intensifies tax education especially on the gifts tax obligations immediately, and puts in place measures to enforce such obligations.