VOLUNTARY TAX COMPLIANCE BEHAVIOUR OF SMALL AND MEDIUMSIZED ENTERPRISES (SMEs) IN NIGERIA

ABSTRACT
This study investigated the factors affecting voluntary tax compliance by SMEs. Specifically, the
study sought to establish the effect of complexity of Nigerian tax system, SMEs perception of tax
fairness, tax education and awareness, external stakeholders, cultural and socioeconomic factor
on voluntary tax compliance by SMEs.
The study used the primary research instrument through the administration of questionnaire to
source data needed for the study. The study targeted a sample of two hundred (200) respondents,
in which a total of 200 questionnaires were distributed and same number (200) was filled,
retrieved, cleaned and used for this study. The data collected was analyzed using SPSS version
20.0 and descriptive statistics was used to present the results while regression test was employed
to make findings on the research hypotheses. It was revealed that: the complexity of Nigerian tax
system is not significantly related to voluntary tax compliance by SMEs; SMEs’ perception of
tax fairness is significantly related to voluntary tax compliance by SMEs; tax education and
awareness is not significantly related to voluntary tax compliance by SMEs; external stakeholder
is not significantly related to voluntary tax compliance by SMEs; and cultural and socioeconomic
factor is significantly related to voluntary tax compliance by SMEs.
Based on these findings, it was recommended that: it is essential to invest in more
comprehensive and targeted tax education programs for SMEs; tax authorities should strive for
transparent and equitable tax policies and practices; simplifying tax procedures and reducing
bureaucratic hurdles can make it easier for SMEs to comply voluntarily; policymakers should
cultural and socioeconomic aspects when designing tax policies and interventions; and it is still
crucial for tax authorities to engage with external parties such as business support organizations,
consultants, and tax professionals.