EFFECT OF TAX AUDIT ON REVENUE GENERATION BY FEDERAL INLAND REVENUE SERVICE IN NIGERIA

Abstract

This study investigates the effect of tax audit on revenue generation by the Federal Inland Revenue Service (FIRS) in Nigeria, with a focus on five key independent variables: audit coverage, audit frequency, audit penalties and sanctions, use of technology in auditing, and audit staff competence and training. Anchored on the Economic Deterrence Theory and the Resource-Based View, the study adopts a quantitative survey design, using structured questionnaires administered to 120 selected FIRS staff. Descriptive and inferential statistical tools, including correlation and multiple regression analysis, were employed to test the hypotheses. The findings revealed that all five tax audit variables investments, deploying advanced audit tools, expanding audit coverage using risk-based approaches, and enforcing consistent penalties. These findings have important implications for tax policy reforms and operational efficiency within FIRS.

Keywords: Audit Coverage, Audit Frequency, Revenue Generation, Tax Audit, Technology in Auditing