Tax digitalisation and revenue generation system: The empirical approach

Abstract

Revenue and more revenue are the aspiration of government to ensure development is sustained. Nevertheless, the paper argued that despite the importance of revenue generation to country’s economy, records has shown that based on systems in place, revenue generation especially in developing countries like Nigeria has remained relatively low. Consequently, the need to investigate if tax digitalisation dimensions could have an effect on revenue generation of Federal Inland Revenue Service (FIRS), Abuja, Nigeria is germane. The study applied the cross-sectional survey research design in obtaining primary data from 603 employees of the Federal Inland Revenue Service in Abuja, Nigeria. The simple random sampling technique was implemented while the reliable and validated tests were conducted on the adapted questionnaire before applying it for the study. Results from the multiple regression analysis revealed that tax digitalisation dimensions had a positive and significant effect on revenue generation (Adj. R2 = 0.795, (F (4, 598) = 583.786, p<0.05) with online payment system as the best predictor on revenue generation. management of FIRS should ensure accuracy of account book, relevant tax authority approval, encourage use of apple pay for remittance, should create electronic reports for taxpayers to improve revenue generation system.