Tax Awareness, Tax Knowledge, Moral Obligations and Tax Evasion among Small and Medium Enterprises Owners In Kwara State, Nigeria
DOI:
https://doi.org/10.52461/sabas.v7i2.4602Keywords:
Tax Evasion, Tax Awareness, Tax knowledge, Moral Obligation, Small and Medium Enterprises (SMEs)Abstract
Tax evasion has remained a recurring menace in many countries with negative impact on ability of governments to generate sustainable revenue for economic growth and development. Literature and anecdotal evidence established that evasion is rampant among small and medium enterprises (SMEs) owners in developing countries, including in Nigeria. Therefore, this study examined effect of tax awareness, tax knowledge and moral obligation on tax evasion behaviour of SMEs owners in Kwara State Nigeria. Primary data was collected with questionnaire administered to 393 SME owners in Kwara State. The data were analysed using multiple regression technique. The results show that: tax awareness has a significant negative relationship with tax evasion (β = -0.128, p=0.000); tax knowledge has a significant positive effect on tax evasion (β = 0.127, p= 0.004); while moral obligation has a significant negative relationship with tax evasion (β = -0.165, p = 0.002). Based on the findings of the study, tax awareness, tax knowledge and moral obligation are determinants of tax evasion among SMEs owners in Kwara State. The study recommended that Kwara State through its tax authority- Kwara State Internal Revenue Service (KWIRS) needs to embark on awareness creation and campaigns directed toward the informal private sector firms of various size to achieve improved tax awareness and moral obligation as well as advocation for tax knowledge that facilitate tax compliance, in order to minimised negative effect of tax evasion on government tax revenue generation needed to stimulate the economic growth and development.
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