Determinants of Sustainable Value-Added Tax Revenue Generation in Nigeria
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Date
2026
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Danubius University of Galati
Abstract
This study examined the determinants of sustainable Value-Added Tax (VAT)
revenue in Nigeria, specifically, it focused on determining the effects of VAT policy gaps, VAT system
simplicity, VATcompliance, and VAT fairness perceptions on sustainable VAT revenue performance in
Nigeria. Prior Work: While extant literature acknowledges VAT’s fiscal importance and challenges like
complexity and tax gaps, integrated empirical research on how these factors influence VAT revenue
sustainability in Nigeria remains lacking. Approach: Using a cross-sectional survey, primary data were
collected from 384 VATable entities, tax officials, and experts. Partial Least Square - Structural Equation
Modelling (PLS-SEM) was employed for analysis. Results: All four constructs—policy gap, simplicity,
compliance, and fairness perception show a significant positive effect on sustainable VAT revenue.
Implications: Tax authorities must adopt integrated reforms that close policy gaps via efficient data systems,
simplify compliance, and foster fairness perceptions to enhance voluntary compliance and long-term VAT
revenue sustainability. Value: This study uniquely moves beyond revenue collection to empirically modelling
of the drivers of sustainable VAT revenue generation, thus offering a holistic framework linking VAT policy,
administration, and taxpayer perceptions for developing economies.
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Citation
Adigbole et al.