Tax Policy and Tax Compliance in Nigeria: Evidenced from Kwara State

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.