Evaluating the Impact of VAT Collection Practices on Revenue Generation: A case Study of Galan Guda Sub city, Shager City Administration

Abstract

This study examines the impact of Value Added Tax (VAT) collection practices on revenue generation in Galan Guda Sub-City. A case study approach was used, with primary data gathered via questionnaires and interviews from 20 experts and middle-level leaders. The questionnaire, comprising 18 Likert-scaled items, demographic questions, and open-ended prompts, was analyzed using SPSS version 26. Findings indicate a generally positive perception of VAT's significance, but reveal challenges in the efficiency, clarity, and fairness of key processes (registration, filing, audits). Concerns also arise regarding revenue stability, adequacy of training, inter-agency collaboration, and VAT rate optimization. To move from basic functionality to optimal performance, improvements are required in process design, collaboration, and taxpayer support. Addressing these issues is critical to maximizing revenue, enhancing compliance, and ensuring the long-term financial sustainability of Galan Guda Sub-City, ultimately achieving an equitable and efficient VAT system