WITHHOLDING TAX KNOWLEDGE AND SUPPLY PRICING: PERSPECTIVE OF SUPPLIERS IN THE CAPE COAST METROPOLIS

This paper explored the relevant knowledge of suppliers about withholding tax (WHT) system in Ghana and the implication on supply pricing. The study was conceived from the fact that procurement cost of government institutions are often higher than private institutions. Therefore, the paper sought to explore some of the possible causes from the perspective of withholding tax enforcement. The paper followed qualitative approach and exploratory design using data from suppliers in metropolis. The structure of the study featured two themes: suppliers knowledge of WHT and implications of WHT on supply pricing. It was found that the suppliers generally have very low knowledge about WHT in Ghana. It was further revealed that suppliers compensate the WHT deduction by increasing their prices especially when supplying to Government institutions. It is recommended that tax education especially on WHT should be intensified by the Ghana Revenue Authority. The WHT agents are advised to educate their suppliers. GRA should also make the effect of WHT deduction on suppliers tax affairs transparent to them so that they would not assume that they are paying the tax twice. This could minimise the urge to increase pricing due to the WHT.