Tax Education, Fairness and Penalty on Compliance Behavior of Micro, Small and Medium Enterprises in Bayelsa State, Nigeria

Abstract

This study investigated the relationship between tax education, tax fairness and tax penalty on voluntary tax compliance in Bayelsa State, Nigeria. A cross sectional survey was conducted on a sample of owners of micro, small and medium enterprises (MSMEs) in Bayelsa State. Primary data were collected using a questionnaire with a five-point Likert scale. The sample was 313 owners of micro, small and medium enterprises (MSMEs) taxpayers that were purposely selected. The data collected were presented with the use of descriptive statistics, while bivariate and univariate analysis was used in the estimation of the regression model developed for the study. The results from the analysis revealed a positive and significant relationship between print form tax education and voluntary tax compliance; positive and significant relationship between electronic form tax education and voluntary tax compliance; positive and significant relationship between stakeholder sensitization programme and voluntary tax compliance; positive and significant relationship between tax fairness and penalty on voluntary tax compliance in Bayelsa State, Nigeria. The study concluded that tax education, tax fairness and tax penalty influence the level of tax compliance of micro, small and medium enterprises (MSMEs) in Bayelsa State, Nigeria. The study, therefore, recommended amongst others that the government through the relevant tax authorities should evaluate and re-integrate tax education programs feedback on tax behaviors to progressively increase revenue generation.