Abstract
The study interrogates the relationship between educational level and tax compliance in Nigeria. The study employs the ex post facto research design to ascertain how government investment in education enhances tax compliance. The study covers 17 years (2002-2018) for both tax revenue (a surrogate for tax compliance) and education expenditure (a surrogate for educational level). From the empirical results, the study concludes that there is a positive nexus between government expenditure on education and tax revenue. The study, therefore, recommends that as a matter of necessity, the government should invest more in the overall educational demand of her citizens not only from tax revenues but from other oil and non-oil sources. The governments, from the federal and state levels, should act as a matter national priority endeavour to meet up with the international budgetary benchmark allocation for education, as recommended by the United Nations Educational, Scientific and Cultural Organization (UNESCO) in its Education for All (EFA) document 2000-2015. This will give Nigerians more access to quality education that would result in moving up the global ranking in HDI with its resultant benefits.
Highlights
Empirical studies in the field of behavioural sciences have documented clearly the impact of various situational, socio-cultural and demographic factors that, stimulates and influences human behaviour
The study interrogates the relationship between educational level and tax compliance in Nigeria
The governments, from the federal and state levels, should act as a matter national priority endeavour to meet up with the international budgetary benchmark allocation for education, as recommended by the United Nations Educational, Scientific and Cultural Organization (UNESCO) in its Education for All (EFA) document 2000-2015. This will give Nigerians more access to quality education that would result in moving up the global ranking in Human Development Index (HDI) with its resultant benefits
Summary
Empirical studies in the field of behavioural sciences have documented clearly the impact of various situational, socio-cultural and demographic factors that, stimulates and influences human behaviour. Given that Nigeria ranks very low in the human development index, predicated on her low level of investment in education, healthcare and basic infrastructure, re-jigging taxation to make it the primary source of generating public revenue must be contextualized within the framework of the country’s educational index. Against these backdrops, this study empirically interrogates the relationship between educational level and tax compliance for a period of 17 years Negative correlations were stated between education and the level of tax compliance that can be credited to utilising opportunities for tax avoidance & evasion with increasing fiscal knowledge (Helhel & Ahmed, 2014)
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