EFFECT OF TAX AUDIT ON TAX COMPLIANCE IN NIGERIA
Keywords:
Desk Audit, Field Audit, Tax Audit, Tax ComplianceAbstract
The study examined the effect of Tax audit on Tax compliance in Nigeria. Specifically, it sought to assess the effect of desk audit and the field audits on Tax compliance in Nigeria Adopting the quantitative survey approach, a total of 139 Respondents were sampled from 235 permanent (Managerial and Non-managerial cadres) staff of Federal Inland Revenue Service (FIRS), Abuja. However, primary data collated from 127 Samples were analysed using the Partial Least Squares Structural Equation Modeling (PLS-SEM) with the aid of Statistical Package for Social Sciences (SPSS) version 23.0. Findings showed that desk audit has significant effect on the Tax compliance in Nigeria (p-value 0.002 < 0.05). It was discovered that Field audit has significant positive effect on Tax compliance in Nigeria (p-value 0.005 < 0.05). In conclusion, The country’s Tax system, therefore, stands to benefit from continued investment in audit technologies, human resource development, and the establishment of risk-based audit selection criteria to optimize audit outcomes. The study recommended that Tax authorities, particularly the Federal Inland Revenue Service (FIRS) and State Internal Revenue Services (SIRS), should invest in modernizing audit infrastructure. This includes upgrading digital audit tools and data analytics systems for desk audits to improve efficiency and reduce manual errors. Also, efforts should be made to enhance logistics and staffing capabilities for field audits to allow more coverage of non-compliant or high-risk Taxpayers.. The study examined the effect of Tax audit on Tax compliance in Nigeria. Specifically, it sought to assess the effect of desk audit and the field audits on Tax compliance in Nigeria Adopting the quantitative survey approach, a total of 139 Respondents were sampled from 235 permanent (Managerial and Non-managerial cadres) staff of Federal Inland Revenue Service (FIRS), Abuja. However, primary data collated from 127 Samples were analysed using the Partial Least Squares Structural Equation Modeling (PLS-SEM) with the aid of Statistical Package for Social Sciences (SPSS) version 23.0. Findings showed that desk audit has significant effect on the Tax compliance in Nigeria (p-value 0.002 < 0.05). It was discovered that Field audit has significant positive effect on Tax compliance in Nigeria (p-value 0.005 < 0.05). In conclusion, The country’s Tax system, therefore, stands to benefit from continued investment in audit technologies, human resource development, and the establishment of risk-based audit selection criteria to optimize audit outcomes. The study recommended that Tax authorities, particularly the Federal Inland Revenue Service (FIRS) and State Internal Revenue Services (SIRS), should invest in modernizing audit infrastructure. This includes upgrading digital audit tools and data analytics systems for desk audits to improve efficiency and reduce manual errors. Also, efforts should be made to enhance logistics and staffing capabilities for field audits to allow more coverage of non-compliant or high-risk Taxpayers..
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