IMPACT OF TECHNOLOGY ADOPTION IN ENHANCING TAX COMPLIANCE IN E-COMMERCE IN NIGERIA.

Abstract

The rapid expansion of e-commerce has created challenges in tax compliance, necessitating the adoption of technology-driven solutions to enhance efficiency. This study examines the role of technology adoption in enhancing tax compliance efficiency in Nigeria’s e-commerce sector, focusing on three key technological factors: automated tax calculation software, integration of tax reporting tools, and cybersecurity in digital tax systems. A survey research design was employed, with data collected from e-commerce businesses and analyzed using regression analysis to determine the relationship between technology adoption and tax compliance efficiency. The findings reveal that automated tax calculation software and cybersecurity in digital tax systems have a significant positive impact on tax compliance efficiency. However, the integration of tax reporting tools showed a positive but not statistically significant effect, suggesting that challenges in implementation and regulatory enforcement may limit its effectiveness. The study concludes that technology adoption significantly improves tax compliance efficiency, but its success depends on factors such as digital infrastructure, regulatory frameworks, and cybersecurity measures. Based on these findings, the study recommends that government agencies provide incentives for adopting automated tax software, enforce the integration of digital tax reporting tools, and strengthen cybersecurity frameworks to enhance compliance. Furthermore, investments in digital infrastructure and tax policy harmonization are crucial to improving tax administration in Nigeria’s e-commerce sector. Future research should explore the barriers to adopting digital tax solutions and the potential role of emerging technologies like blockchain and artificial intelligence in tax compliance