Abstract:
This study examined the influence of non-economic factors such as socioeconomic factors and psychological components which have the tendency of
influencing tax compliance.
The study was based on the Fisher tax compliance model. A partial
modification of the model was done by incorporating an important tax compliance
determinant – “Tax Knowledge”. The effect of perceived tax fairness, tax
knowledge, and tax complexity in tax compliance decisions among a sample of
350 self-employed persons in Cape Coast metropolis was explored. Descriptive
correlational design was adopted in the study.
The data was analysed by multiple regression, ANOVA and Chi square
methods which were undertaken with SPSS software. The findings revealed that
simultaneously, perceived tax fairness, tax knowledge and tax complexity
influence taxpayers’ compliance decisions. While the partial test showed that both
tax fairness and tax knowledge affect the tax compliance among SMEs taxpayers
in Cape Coast while the tax complexity/ structure did not give any significant
effect on tax compliance.
The results of the study suggest that tax knowledge is a key factor which
determines tax compliance levels of the self employed especially in the self
assessment system. It is, therefore, recommended that tax education programmes
be designed for the self employed to help improve on their tax knowledge.
