Abstract

Electronic Tax Administration (e-Tax) has become an integral component of modern tax administration, enabling governments to improve tax collection efficiency, strengthen taxpayer compliance, enhance transparency, and increase domestic revenue generation through the application of digital technologies. Electronic Tax Administration encompasses various digital tax services, including electronic taxpayer registration (e-registration), electronic tax filing (e-filing), electronic tax payment (e-payment), electronic tax clearance certificates (e-TCC), online taxpayer accounts, automated tax assessment, and digital tax monitoring systems. These technologies simplify tax procedures, reduce compliance costs, minimize human interaction, improve record accuracy, and facilitate timely fulfillment of tax obligations. In Nigeria, the Federal Inland Revenue Service (FIRS) and State Internal Revenue Services (SIRS) have intensified the deployment of digital tax administration platforms such as TaxPro Max and other electronic tax solutions as part of broader tax modernization initiatives aimed at expanding the tax base, improving voluntary compliance, and enhancing non-oil revenue generation. Small and Medium Enterprises (SMEs) constitute a vital sector of the Nigerian economy, contributing significantly to employment creation, industrial development, innovation, and Gross Domestic Product (GDP). Despite their importance, many SMEs continue to exhibit low levels of tax compliance due to complex tax procedures, inadequate tax knowledge, multiple taxation, poor record-keeping practices, high compliance costs, and limited awareness of tax regulations. Electronic Tax Administration is expected to improve tax compliance by simplifying tax processes, enhancing transparency, reducing administrative burdens, and promoting voluntary compliance. Nevertheless, challenges such as inadequate digital infrastructure, poor internet connectivity, cybersecurity concerns, limited digital literacy, and resistance to technological change continue to affect the effective adoption and utilization of electronic tax systems among SMEs. Although previous studies have examined electronic taxation and digital tax reforms, empirical evidence regarding the impact of Electronic Tax Administration on tax compliance among Small and Medium Enterprises in Nigeria remains limited and inconclusive. Against this background, this study investigates the impact of Electronic Tax Administration on tax compliance among Small and Medium Enterprises in Nigeria. The study is anchored on the Technology Acceptance Model (TAM), the Theory of Planned Behaviour (TPB), and Fiscal Exchange Theory. The Technology Acceptance Model explains that SME owners and managers are more likely to adopt Electronic Tax Administration systems when they perceive them as useful, efficient, and easy to use in meeting their tax obligations. The Theory of Planned Behaviour posits that taxpayers' attitudes, subjective norms, and perceived behavioural control significantly influence their willingness to comply with tax regulations through electronic tax platforms. Fiscal Exchange Theory argues that taxpayers are more likely to comply voluntarily when tax administration is transparent, efficient, equitable, and capable of translating tax revenues into quality public goods and services. Collectively, these theoretical perspectives provide a comprehensive framework for explaining the relationship between Electronic Tax Administration and tax compliance among SMEs in Nigeria. The study adopts a quantitative research design using a structured questionnaire administered to SME owners, accountants, finance managers, tax consultants, financial controllers, and other personnel responsible for tax administration within selected Small and Medium Enterprises across Nigeria. A stratified random sampling technique will be employed to ensure adequate representation of SMEs operating in manufacturing, agriculture, wholesale and retail trade, construction, hospitality, healthcare, transportation, telecommunications, and other service sectors. Primary data collected from respondents will be analyzed using descriptive statistics to summarize respondents' demographic characteristics and perceptions regarding Electronic Tax Administration and tax compliance. Structural Equation Modeling (SEM) will be employed to examine the impact of Electronic Tax Administration on tax compliance. The measurement model will be evaluated using Cronbach's Alpha, Composite Reliability (CR), Average Variance Extracted (AVE), and Confirmatory Factor Analysis (CFA) to establish the reliability and validity of the research instrument. Additional diagnostic tests, including multicollinearity assessment, common method bias analysis, and model fit indices such as the Comparative Fit Index (CFI), Tucker-Lewis Index (TLI), Root Mean Square Error of Approximation (RMSEA), and Standardized Root Mean Square Residual (SRMR), will be conducted to ensure the adequacy, consistency, reliability, and robustness of the structural model. The study anticipates that Electronic Tax Administration will have a significant positive impact on tax compliance among Small and Medium Enterprises in Nigeria. The adoption of electronic tax systems is expected to simplify taxpayer registration, facilitate timely tax filing and payment, improve the accuracy of tax records, reduce compliance costs, and minimize opportunities for tax evasion, tax avoidance, and administrative errors. Electronic Tax Administration is also anticipated to strengthen transparency, improve communication between tax authorities and taxpayers, enhance tax monitoring and enforcement, and increase voluntary compliance through more efficient and user-friendly digital platforms. Furthermore, SMEs utilizing electronic tax systems are expected to experience improved financial record-keeping, greater regulatory compliance, enhanced business credibility, and easier access to government support programmes and financial services. Conversely, SMEs with inadequate technological infrastructure, limited digital literacy, poor internet connectivity, or insufficient awareness of electronic tax services may continue to experience tax compliance challenges and underutilize available digital tax platforms. Consequently, effective implementation and widespread adoption of Electronic Tax Administration are expected to strengthen voluntary tax compliance, broaden the national tax base, improve domestic revenue mobilization, and support sustainable fiscal development in Nigeria. This study is expected to make significant theoretical and empirical contributions to the literature on taxation, accounting information systems, public finance, and digital governance by providing robust evidence on the relationship between Electronic Tax Administration and tax compliance among Small and Medium Enterprises in Nigeria. Unlike previous studies that broadly examined electronic taxation or tax administration reforms, this research provides a comprehensive evaluation of Electronic Tax Administration as an integrated digital tax management system influencing SME tax compliance using primary data and Structural Equation Modeling (SEM). The findings will provide valuable insights for the Federal Inland Revenue Service (FIRS), State Internal Revenue Services (SIRS), the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN), the Federal Ministry of Finance, policymakers, tax practitioners, software developers, professional accounting bodies, SME owners, and academic researchers regarding the strategic importance of Electronic Tax Administration in promoting voluntary compliance and strengthening domestic revenue generation. The study will also provide evidence-based recommendations for improving digital tax infrastructure, strengthening taxpayer education, enhancing cybersecurity measures, reducing compliance costs, expanding digital tax literacy, promoting technology adoption among SMEs, and fostering a more efficient, transparent, and sustainable tax administration system in Nigeria.

Keywords: Electronic Tax Administration, tax compliance, Small and Medium Enterprises (SMEs), e-filing, e-payment, TaxPro Max, digital taxation, Structural Equation Modeling (SEM), public finance, Nigeria.