Tax Assessments and Tax Revenue in Nigeria

This study examines the relationship between tax assessment and tax revenue in Nigeria. Focusing on self-assessment and additional assessment as dimension of tax assessment, the research assesses tax revenue using company income tax and value added tax. Quantitative research was employed for this study, utilizing secondary data collected from States in South South region. This study adopts the economic theory of tax compliance and the policeman theory to guide this analysis. Data was analyzed using Pearson products moment correlation coefficient to explore the strength and direction of the relationships between variables. The findings reveal that there is a strong relationship between tax assessment and tax revenue of federal Inland Revenue Service in Nigeria. Specifically, Self-Assessment has a strong positive correlation with Company Income Tax (r = 0.912, p-value = 0.000) and Value Added Tax (r = 0.876, p-value = 0.000). Additionally, the Additional Assessment indicated a strong positive correlation with Company Income Tax (r = 0.821, p-value = 0.000) and with Value Added Tax (r = 0.859, p-value = 0.000), all significant at 0.5 level of confidence. The results shows that there is a positive correlation between tax assessment and tax revenue and also Self-Assessment method generates more revenue, Company Income Tax contributes significantly to total tax revenue and Inadequate taxpayer education, inefficient tax administration, and corruption hinder tax assessment and revenue collection. It is recommended that there should be an improvement in taxpayer education and awareness, enhancing tax administration efficiency, strengthening anti-corruption measures and voluntary compliance should be encouraged.