DETERMINANTS OF TAX COMPLIANCE IN ABIA STATE

DETERMINANTS OF TAX
COMPLIANCE IN ABIA STATE
Chidinma Ezeigho and Edwin Fashola
Department of Accounting, College of
Management Sciences,
Michael Okpara University of
Agriculture, Umudike, Abia
State, Nigeria.
edwinfash@yahoo.com
Accounting and Finance Research Association
Abstract
This study examines the determinants of tax
compliance in Abia State of Nigeria. Survey
research design was adopted and data
collected using validated 5-point likert
questionnaire with which respondents’ views
on issues relating to the level of tax
compliance in the State.
Data on planned and actual collected tax
revenue by the State were sourced from the
Abia State Board of Internal Revenue
Services. Vector error correction model was
used to analyze the data. Results reveal that
individuals’ taxable capacity of and the
automated tax collection system are the
major determinants of tax compliance in Abia
State. The paper concludes that tax policy
implementation in Abia State is weak and
creates loopholes for tax evasion and for low
level of tax compliance to thrive in the State.
We therefore recommend that Abia State
Government, and indeed other State
Governments in Nigeria, should improve tax
administration procedure to curb tax evasion
through complete automation of revenue
generation in all areas of economic activities
in States.
Keywords:
Taxable
capacity,Tax
Administration Procedure, Tax

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