IMPACT OF TAX PENALTY ON TAXPAYERS’ SELF-ASSESSMENT IN NIGERIA
Abstract
Self-assessment, in Nigeria, was introduced to ease compliance, yet many taxpayers still find a way of not fully complying. Therefore, this study attempts to determine the impact of a tax penalty on self-assessment. Anchoring the research design on the cross-sectional survey method, we targeted the RED zone tax offices of the Federal Inland Revenue Service (FIRS) in the South-South Region of Nigeria. Applying the subjective sampling method, the study selected 300 respondents from FIRS staff and taxpayers. Descriptive analysis and PPMC were employed in the data analysis. The result showed that tax penalties have a significant and very strong positive impact on taxpayer self-assessment, with a significance value of 0.000 and correlation value of 0.855. The recommendations include ensuring that penalty guidelines are clearly communicated and uniformly enforced to maintain consistency and credibility, regularly reviewing penalty structures to ensure they remain proportionate and effective in deterring non-compliance and also considering a progressive penalty structure where the severity of penalties increases with repeated non-compliance but ensuring that first-time offenders are given opportunities for correction without excessive financial burden. The study concludes that the imposition of tax penalties significantly enhances self-assessment compliance among taxpayers.
Keywords:
Tax penalty, self-assessment, red zone tax officeDownloads
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Copyright (c) 2025 Nwagu Iruka Okoronkwo (Ph. D), Igweagbara Gladday (Ph. D, FCA) , Akor, James Eleche (Ph. D)
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