Empirical investigation of the nexus between tax audit and taxpayers' compliance in South West, Nigeria (original) (raw)
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Tax audit is the independent examination of the returns submitted by taxpayers to the relevant tax authorities to ascertain the level of tax compliance by taxpayers. The objective of this paper is to examine the impact of tax audit on tax compliance in Nigeria. To achieve this objective, data was collected from primary and secondary sources. The secondary sources was from scholarly published and unpublished studies and the primary source from a well structured questionnaire of three sections administered to two hundred and four (204) respondents with an average reliability of 0.77 using diagnostic tests, augmented dickey-fuller, ordinary least square and granger causality. The empirical analysis provided a significant relationship between random tax audit, cutoff tax audit and conditional tax audit on tax compliance in Nigeria. On the basis of the empirical result, the paper concludes that tax audit is one of the compliance strategies that can be used to achieve tax compliance in Nigeria because the average Nigerian is known for tax evasion and avoidance using all the available means of not paying the relevant tax to the government. Therefore, the paper recommends amongst others that government should show some degree of accountability and transparency on the revenue collected to make citizens understand the connection between tax revenue and expenditure; the government should implement the relevant tax laws faithfully, equitably and fairly irrespective of the persons status and organization concerned; the relevant tax authorities at all levels should improve on the standard of tax audit employed for effectiveness and efficiency in tax administration to reduce the high level of tax evasion on those that are self-employed.
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TAX AUDIT, PENALTY AND TAX COMPLIANCE IN NIGERIA 5.cdr
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Statistical Analysis of Citizen’s Personal Income Tax Compliance in Lagos State, Nigeria
Journal of Economics and Sustainable Development, 2019
This study focused on tax compliance in Lagos State, Nigeria among employees that are gainfully employed. A survey design was adopted for collecting data with a self-designed questionnaire administered among residents of Shomolu Local Government Area. The instrument was validated by experts and through a pilot study and the Cronbach's Alpha reliability coefficient was 0.834. A two-stage sampling technique was used to select 344 respondents of which 318 were completed, returned and used. The data thus collected were analysed using descriptive statistics, Spearman's correlation and Chi-square tests with the aid of Statistical Package for Social Sciences (SPSS). The result showed that tax compliance was 74.9% and there is significant positive relationship between taxpayers' tax compliance (TTC) and the revenue generation (RG) in Lagos (p < 0.05), tax morale (TM) (p < 0.05) and taxpayer's confidence in legal system (TCL) (p < 0.05). However, a significant negative relationship exists between taxpayers' tax compliance (TTC) and tax rate (TR) (p < 0.05). It is therefore concluded that a high tax morale and high taxpayers' confidence in the legal systems will enhance their tax compliance which in turn will lead to higher revenue generation in Lagos. It was recommended that Government should boost the morale of tax payers through accountability and efficient utilisation of taxpayers' fund in providing qualitative education, free and affordable healthcare and good roads; implement the available laws to enhance taxpayers' confidence in the legal systems and reduce existing tax rates to enhance tax compliance among the citizenry.
Addressing Tax Evasion and Avoidance through Effective Tax Audit and Investigation in Cross River State, Nigeria, 2019
The paper addresses tax evasion and avoidance through effective tax audit and investigation in Cross River State.The study adopts survey research design, while data were collated from staff of FIRS and SIRS in Cross River State. The Chi-square (x 2) statistical tool was employed to analyze respondents' opinion on the effect of tax audit and investigation in addressing tax evasion and avoidance. The results revealed that, while there is a significant difference in the opinions of respondents on the effect of tax audit on tax evasion and avoidance in Cross River State; there was no significant difference in their perception on the effect of tax investigation on tax evasion and avoidance. Penalty also significantly affected tax evasion and avoidance.Identified also was that the thoroughness of the tax audit will encourage taxpayers to be more prudent in complying with tax returns and that the strengthening of tax audit and investigation will wipe away tax evasion and avoidance in Nigeria. It was therefore recommended that tax payers should be educated during tax audits and penalty should be adequately implemented to serve as a deterrent to tax evader and avoiders so as to increase tax compliance and government revenue.
TAX POLICY AND TAX COMPLIANCE IN NIGERIA: EVIDENCED FROM KWARA STATE
POLAC INTERNATIONAL JOURNAL OF ECONS & MGT SCIENCE (PIJEMS, 2024
Over the years, many states in Nigeria have faced persistent challenges of low tax compliance, despite the presence of established tax policies and enforcement mechanisms. Inefficiencies in taxpayer services and ineffective policy implementation have contributed to widespread non-compliance, raising concerns about the adequacy of current tax administration practices. In light of these challenges, this research endeavor seeks to investigate the impact of the execution of tax policies on tax compliance within the jurisdiction of Kwara State. A quantitative survey research methodology was employed, specifically targeting personnel affiliated with the Kwara State Internal Revenue Service (KWIRS). To ensure adequate representation across various hierarchical tiers and functional areas within KWIRS, a stratified random sampling method was utilized, culminating in a sample size of 287, as determined by Taro Yamane’s statistical formula. Primary data was accrued through the distribution of questionnaires, with subsequent analysis conducted employing PLS-SEM. The result indicates a statistically significant positive correlation between the implementation of tax policies and tax compliance. This study concludes that the efficacious execution of tax policies is imperative for the enhancement of tax compliance within Kwara State. Properly enforced and meticulously structured policies, augmented by effective taxpayer services, are instrumental in fostering elevated compliance rates, which are essential for bolstering revenue generation. To mitigate the challenge of suboptimal tax compliance, this study recommends that the KWIRS prioritize the consistent enforcement of tax policies. Additionally, ongoing training and capacity building for tax officials should be prioritized to improve the effectiveness of policy implementation and enforcement, ultimately fostering a culture of compliance among taxpayers.