Lukuman Adewale Jimoh, Samuel Kayode Adekunle, Mustapha Abdulrasaq, Tajudeen John Ayoola, Sarafa Adewumi Agbogun, Saka Abdulsalam Tunde


Tax fraud remains the greatest challenge to the government across the world, but the alarming rate at which it is being perpetrated in Nigeria is of concern to the government. The government has lost billions of naira as a result of this. The involvement of taxpayers in tax fraud depends on the level at which they perceive the institution of governance. Hence, this study examined the influence of interaction between institutional quality and taxpayers’ behaviors on tax fraud management in south-west Nigeria. The study employed a quantitative method to generate data from the total population of 504,263 respondents. The sample size consisted of 400 taxpayers (companies and businesses) registered with the Federal Inland Revenue Service in southwest Nigeria. The data were analyzed using the partial least squares structural equation model (PLS-SEM). The interaction of institutional quality and taxpayer behaviors on tax fraud management was found to have a significant negative relationship (= -0.066, t = -1.763, p = 0.039, 0.05). According to this study, the sets of exogenous latent variables (i.e., institutional quality and taxpayer behaviors) explain 78% of the variance in tax fraud management. The study concluded that the working together of taxpayers’ perceptions of both low institutional quality and taxpayers’ behaviors has a significant influence on the tendency for taxpayers to engage in tax fraud management in south-west Nigeria. It was recommended that the better the morale of a taxpayer, the lower the tax fraud. Therefore, the government is advised to adopt policies and measures that can boost the taxpayers’ morality, which will in turn enable them to see tax fraud as a negative to their principled value system as law-abiding citizens. It is also recommended that tax authorities should be seen as taxpayers' friends by making their interactions with taxpayers less bureaucratic.


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