Knowledge Management and Low Operating Cost Indicator of Tax Administration Efficiency

Abstract

The desire to reduce the operating cost of tax administration to achieve efficiency is obvious globally. However, knowledge management (KM) can reduce operating costs in tax administration to achieve efficiency. The objective of this study is to explain the various ways KM can reduce the cost of operation in tax administration. Qualitative data were sourced via a face-to-face interview with tax officers at Federal Inland Revenue Service (FIRS), Nigeria. Thus, qualitative data were sourced from 20 tax officers (participants) through a face-to-face interview. The data were sourced from tax officer II, tax officer I, the manager, the senior manager, the assistant director, and the deputy director. Participants (tax officers) were selected from domestic taxes, corporate development, modernisation, enforcement and compliance groups based on their experience. Also, data were sourced from national tax policy and a compendium of tax-related laws documents to support the interview data. Furthermore, semi-structured and open-ended interview questions were used as a guide for the face-to-face interview. The face-to-face interview was recorded with a smart voice recorder. Data were thematically analysed and administered with NVivo 10 qualitative software. In the process of analysis, sub-themes identified and reported based on the objective of the study and responses from participants were low manual operation, mistake, compliance and training cost. This study found that KM can reduce operating costs such as manual operation, mistakes, compliance and training costs in tax administration. Thus, KM can engender efficiency in tax administration through low manual operation, mistakes, compliance and training costs. The study recommends formal implementation of KM in tax administration in order to improve efficiency through low cost of administration.