Tax Registration and Tax Revenue Generation in Nigeria: Account of Allingham and Sandmo Theory

Abstract

This research examines the effect of tax registration of micro, small medium enterprises, corporates and individuals on tax revenue generation in Nigeria. The study adopted a descriptive and historical research design; secondary data for nineteen years (2003 - 2022) were collected from various issues of the Central Bank of Nigeria (CBN) statistical bulletin and annual reports. Tax revenue generation as a dependent variable was measured with actual annual total tax revenue. The data was analyzed using multiple regression analysis to establish the relationship between the dependent and independent variables. Durbin Watson test carried out and multicollinearity test using the VIF factor. All the variables have positive influence on actual annual total tax revenue in Nigeria (AATR). The beta values provide a measure of contribution of each variable. Higher beta value indicate greater influence of independent variable on the dependent variable. According to that, number of Corporate Registered Tax Payers (CRTP) (?=.391))has higher influence on actual annual total tax revenue in Nigeria (AATR) which is followed by number of Enterprise Registered Tax Payers (ERTP) (?=.323), and number of Individual Registered Tax Payers (IRTP). (?=.187) From the study, we examined that, tax registration proxied by number of registered corporate, enterprise and individual taxpayers are significant to tax revenue generation in Nigeria. The results are useful for both tax authorities and taxpayers in order to resolve the problems associated with tax compliance and also to boost tax revenue generation in Nigeria.