Attitude And Behaviour Of Informal Sector Workers Toward Direct Taxes Compliance In Nigeria: An Extended Theory Of Planned Behaviour

Tax compliance remains a global challenge affecting both developed and developing nations but is more pronounced in the developing economies. Focusing on the informal sector workers in the Nigerian economy that contributes about 58 percent to GDP but is largely outside the tax net, the study investigates, using an extended theory of planned behaviour by incorporating socio-demographic factors and corruption perception, the tax compliance behaviour gap. Survey research design was utilised through questionnaire administration and applying Cochran sampling techniques to deduce a 240-sample size and purposively selecting informal sector workers such as artisans, hairdressers, traders, bricklayers, Nigerian hairdressers, and event planners across Lagos State, Nigeria, for data collection. The data collected were analyzed using regression and analysis of variances (ANOVA) to examine the relationship between independent, dependent, and moderating variables of the study. The study revealed that attitude towards tax (fiscal accountability and tax fairness), subjective norms (social pressure), and perceived behavioral control (ease of filing and tax awareness) have a positive and significant influence on tax compliance behaviour of informal sector workers in Nigeria. When corruption perception was included, it showed about 53 percent variation in the tax compliance behavior, affirming a hindrance in tax remittance from informal sector workers due to negative perception of government accountability. Also, the study discovered that educational level, occupation, and age of informal sector workers were identified as having a significant influence on tax compliance behaviour, but income level and gender showed no influence on compliance behavior. The study concluded that demonstrating fiscal accountability and enhancing tax education by the government will improve tax compliance behaviour in Nigeria.