Causes Of Tax Evasion In Ghana And Its Effects On The Economy

Abstract

For decades, tax system and taxation academics have struggled to understand the elements that influence taxpayer noncompliance. Because tax revenues are viewed as an important source of cash in paying government expenditures, numerous experimental and survey results concluded by tax scholars have revealed characteristics of noncompliant taxpayers. Globalization has created a great demand for a variety of public services, prompting governments to raise taxes to fund these programs. The burden of taxes is shifted to taxpayers as a result of the government's and taxpayers' need for public service. Because of taxpayer noncompliance, the gap between tax receipts and tax expenditures is widening, resulting in unbalanced government budgets. Understanding the causes of tax evasion necessitates investigation into the motivations of tax evaders. The study's major goal is to look into the causes of tax evasion in Ghana and how it affects the economy. Based on research of various literatures, we have determined that insufficient government tax incentives, poverty or a lack of cash, a lack of or weak tax law, and insufficient tax education are among the causes of tax evasion in the country.