Marital Status and Educational Background as Determinants of Tax Compliance in Nigeria

International Journal of Research and Innovation in Social Science (IJRISS) | Volume IV, Issue VIII, August 2020 | ISSN 2454–6186

Marital Status and Educational Background as Determinants of Tax Compliance in Nigeria

Aregbesola, O.D^1*, Owosekun, A.O² & Salawu, R.O³

¹Department of Accounting and Finance, Bowen University Iwo, Nigeria
²Department of Economics, Bowen University Iwo, Nigeria
³Department of Management and Accounting, Obafemi Awolowo University, Ile-Ife, Nigeria
*Corresponding author

Abstract: This study analysed the influence of marital status and educational background of the tax payers on Personal Income Tax compliance in Nigeria.
The study employed a cross-sectional design which made use of a structured questionnaire. The population of the study comprised of employees who were 18 years and above in the public and private organizations as well as artisans and traders to represent the informal sector. The Taro Yamane formular was used to determine the sample size of 400 which was distributed among the three Southwestern states selected namely, Lagos, Oyo and Osun using proportionate sampling technique. Data were analysed using percentages, mean, standard deviation and Analysis of Variance (ANOVA). Findings showed that marital status significantly influence personal income tax compliance in Nigeria (P=0.005) and mean scores showed that singles were more compliant than other categories of marital status, like the married and divorced. Also, educational background does not significantly influence personal income tax compliance (P=0.338).
The study concluded that in order for the government to achieve a desirable level of tax compliance among the populace, there is need for government to encourage the populace. Furthermore, the tax law should be more explicit and positioned in such a way as to improve its applicability.

Keywords: Marital Status, Educational Background, Tax Compliance, Tax Payers.

I. INTRODUCTION

Taxation has existed in various forms for thousands of years as an important means of generating income to government providing the largest single source of revenue. Tax is, therefore, one of the most important and durable sources of financing the expenditures of all governments.
Personal income tax, the focus of this study is the most ancient form of tax in Nigeria. This was earlier introduced as a community tax in Northern Nigeria in 1904. This was later formulated into Direct Taxation Ordinance number 4 of 1940 (Ola, 2001). The need to subject personal income to tax brought about the Income Tax Management Act (ITMA) of 1961. Several amendments were made to the 1961 ITMA Act in 1985, 1989, 1990, 1992, 2004, 2011 and recently, 2020.

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