EFFECTS OF AUDIT INFORMATION TECHNOLOGY ON TAX COMPLIANCE IN SOUTH-WEST NIGERIA

Abstract

This study investigates the effects of audit information technology on tax compliance in South-West Nigeria. Effective tax administration increasingly relies on technological tools, including electronic audit systems, data analytics, and software applications, to enhance compliance monitoring and enforcement. The study adopted a quantitative research design, collecting primary data from 344 tax officials and auditors across Lagos, Oyo, Ogun, Osun, Ekiti, and Ondo States using structured questionnaires. Multiple regression analysis was conducted using SPSS version 22 to examine the relationship between audit information technology variables—technical proficiency, software acquisition, electronic audit systems, and data analytics—and tax compliance. The results show that software acquisition (β = 0.316, p < 0.01) and data analytics (β = 0.663, p < 0.01) have a significant positive effect on tax compliance, while electronic audit systems exhibit a negative relationship (β = -0.467, p < 0.01). Technical proficiency, however, was not statistically significant (β = 0.164, p > 0.05). The regression model explained approximately 43.1% of the variance in tax compliance (R² = 0.431). The findings suggest that investment in audit technologies, particularly data analytics and software tools, can enhance compliance among taxpayers, but proper system implementation and integration are critical. The study recommends continuous training for tax personnel, strategic acquisition of audit technologies, and the effective deployment of electronic audit systems to improve tax compliance in the region.