Impact of Tax Reforms on Revenue Performance of Federal Inland Revenue Service of Nigeria

Governments globally face the ongoing challenge of mobilizing sufficient resources to foster economic growth, development, and sustainability. To address this, taxation and tax administration have emerged as vital elements in shaping economic policies. The objective of the study is to examine the impact of tax reforms on the revenue performance of the Federal Inland Revenue Service of Nigeria. This study employs an ex-post facto research design, utilizing secondary data to draw comparisons between the revenue performance of the FIRS in Nigeria before and after the tax reforms. Data was sourced from FIRS to evaluate revenue performance in two distinct periods: before the reforms (1991-2006) and after the reforms (2007-2023). Given the time series nature of the data, a t-test is used to determine if there is a significant difference between the means of the two periods. The t-test evaluates whether the means of the two-time frames are statistically different from each other. The study’s statistically significant difference between pre-and post-reform revenue levels provides strong evidence that the 2007 reforms had a meaningful impact on the performance of FIRS in revenue collection. The reforms appear to have improved efficiency and tax compliance, making a case for the positive role of systematic tax administration reforms in enhancing fiscal sustainability the findings from this study provide strong evidence that the 2007 reforms positively impacted FIRS’s revenue collection performance in Nigeria. Based on the study findings, it was recommended Expanding digital and automated systems within tax administration can improve compliance and minimize revenue leakages. Enhanced data management and automated processing can reduce errors and increase collection efficiency. Increasing public understanding of tax obligations and the benefits of compliance is crucial for further improving revenue performance.