VALUE ADDED TAX REFUND PRACTICES AND REVENUE PERFORMANCE: THE CASE OF MINISTRY OF REVENUE (MOR) LARGE TAX PAYER’S OFFICE

Abstract

The main objective of the study is to assess VAT refund practices and revenue performance: the case of Ministry of Revenue (MOR) Large Tax Payers Office. In doing so, the paper further assesses the VAT revenue performance in the targeted study area. The study used both qualitative and quantitative research methods to collect and analyze both primary and secondary data. Questionnaire was used to collect primary data from employees and VAT registered respectively. Secondary data was collected from Ministry of Revenue (MOR) Large Tax Payers Office. The Statistical Package for Social Sciences (SPSS) version 20 was the method used for data analysis. The study revealed that the procedures for VAT refund employed in processing and refunding excess VAT credits in MOR large tax payers’ office was not effective; the taxpayers’ were not well aware of the procedures and requirements for VAT refund; the major challenges faced by MOR large tax payers’ office with regard to VAT administration were: VAT fraud, Tax evasion, non-compliance with the law, not using Invoices for selling goods/services, not declaring the collected VAT on time, among others; the level of VAT revenue performance in MOR large tax payers’ office was high comparing the contribution or share of other income sources. The study recommends that MOR large tax payers’ office should create awareness to its taxpayers on the topics of VAT refund, ethics of tax declaration etc…. should follow up and supervise to trace and make the necessary corrective actions of VAT un-invoicing (selling without receipts) with the help of its officers and MOR intelligence experts; additional researches have to be conducted on the topic of VAT administration and VAT refund challenges encountered at MoR large tax payers’ office.