An Evaluation of Tax Avoidance and Tax Evasion on Revenue Generation in Bauchi State

Yakubu Adamu PhD; Alhaji Kawugana PhD

doi:10.56201/ijefm.v10.no5.2025.pg1.15

📄 Download Paper

An Evaluation of Tax Avoidance and Tax Evasion on Revenue Generation in Bauchi State

Yakubu Adamu PhD, Alhaji Kawugana PhD

Abstract

Taxation plays a vital role in revenue generation for governments, especially at the state level, where taxes fund critical public services and infrastructure. However, tax avoidance and tax evasion pose significant challenges to effective revenue collection, leading to substantial financial losses. This study evaluates the impact of tax avoidance and tax evasion on revenue generation in Bauchi State, Nigeria. The research aims to examine the prevalence of these practices, identify their contributing factors, and assess their consequences on the state's economic development. Using both primary data, collected through surveys and interviews with tax officials and taxpayers, and secondary data from government tax records, the study explores the extent of non- compliance with tax obligations. The findings indicate that both tax avoidance and evasion are widespread, with weak enforcement, limited taxpayer education, and inadequate legal frameworks being primary contributors. As a result, Bauchi State experiences considerable revenue shortfalls, hindering its ability to invest in key sectors such as education, healthcare, and infrastructure. The study recommends strengthening tax enforcement mechanisms, increasing public awareness on the importance of tax compliance, and revising tax policies to ensure a more transparent and efficient system. The research highlights the critical need for reform to enhance revenue generation, foster economic growth, and improve the standard of living in Bauchi State.

Keywords

Tax EvasionReturn on AssetsTax AvoidanceRevenue Generation

References

Agha, A., & Haughton, J. (1996). Designing a Tax System for Developing Countries: The Case of Tax Evasion in Nigeria. World Development Journal, 24(7), 1085-1105. Alm, J., & Martinez-Vazquez, J. (2003). Public Finance in Developing Countries. Edward Elgar Publishing. Bauchi State Government. (2022). Bauchi State Tax Revenue Performance Report. Bauchi State Ministry of Finance. Central Bank of Nigeria (CBN). (2023). Nigeria Tax and Economic Policy Report. Abuja: CBN. Friedman, J., & Lister, S. (2010). The Impact of Tax Evasion on Government Revenue. Journal of Public Economics, 47(4), 555-570. Federal Inland Revenue Service (FIRS). (2018). Tax Compliance and Enforcement in Nigeria. Abuja: FIRS. Hasseldine, J., & Bebbington, J. (2000). Tax Evasion and Tax Avoidance: A Review of the Literature and Issues. Australian Tax Review, 29(2), 120-133. Musgrave, R. A., & Musgrave, P. B. (1989). Public Finance in Theory and Practice. McGrawHill. National Bureau of Statistics (NBS), Nigeria. (2022). Annual Report on Nigeria's Revenue Generation and Economic Development. Abuja: NBS. Nigeria Economic Summit Group (NESG). (2021). Tax Policy and Revenue Generation in Nigeria. NESG Report. OECD. (2019). Revenue Statistics in Africa 2019. OECD Publishing. OECD. (2010). Tax Administration in Developing Countries. OECD Publishing. PwC Nigeria. (2021). Tax Compliance and the Role of Technology in Tax Evasion. Available online at: https://www.pwc.com/ng Schneider, F., & Enste, D. H. (2002). The Shadow Economy: An International Survey. Cambridge University Press, 34(1), 28-56. Slemrod, J., & Bakija, J. (2008). Taxing Ourselves: A Citizen's Guide to the Debate over Taxes. MIT Press. Torgler, B. (2005). Tax Morale in Latin America. Public Choice, 122(1), 83-114 World Bank Group. (2015). Improving Tax Revenue in Nigeria: The Impact of Compliance and Enforcement Mechanisms. World Bank Publication. Mikailu, S. (2020). Tax Evasion and Revenue Loss in Nigeria: Strategies for Improvement. Available online at: https://www.taxreview.com.ng U.S. Internal Revenue Service (IRS). (2018). Tax Evasion and Fraud: Measures for Tax Authorities. Available online at: https://www.irs.gov

An Evaluation of Tax Avoidance and Tax Evasion on Revenue Generation in Bauchi State

Abstract

Keywords

References

More Articles from INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT