Chapter One — 1.1 Background to the Study

Digitalization of Tax Administration has increasingly attracted the attention of researchers, regulators, and practitioners concerned with voluntary tax compliance. This growing interest reflects the recognition that digitalization of tax administration does not operate in isolation, but interacts with a wider set of institutional and market conditions found within Enugu State.

Enugu State presents a useful setting for examining this relationship precisely because the conditions there — structural, regulatory, and behavioural — differ from those typically assumed in the broader literature, most of which draws on evidence from more developed economies.

1.2 Statement of the Problem

While digitalization of tax administration is widely discussed in policy and industry circles, empirical evidence on its actual effect on voluntary tax compliance within Enugu State remains sparse and, in places, contradictory. This lack of localized, rigorous evidence makes it difficult for decision-makers to know with confidence whether current approaches to digitalization of tax administration are helping or hindering voluntary tax compliance — a gap this study sets out to close.

1.3 Objectives of the Study

1. To examine the effect of Digitalization of Tax Administration on voluntary tax compliance in Enugu State.
2. To assess the extent to which digitalization of tax administration influences voluntary tax compliance within the study area.
3. To identify the challenges associated with digitalization of tax administration in relation to voluntary tax compliance.
4. To recommend strategies for optimizing digitalization of tax administration in order to improve voluntary tax compliance.

1.4 Research Questions

1. What is the effect of digitalization of tax administration on voluntary tax compliance in Enugu State?
2. To what extent does digitalization of tax administration influence voluntary tax compliance within the study area?
3. What challenges are associated with digitalization of tax administration in relation to voluntary tax compliance?
4. What strategies can be adopted to optimize digitalization of tax administration in order to improve voluntary tax compliance?

1.5 Significance of the Study

This study is significant to a range of stakeholders. For policymakers and regulators, the findings offer evidence to guide the design of frameworks that support healthier outcomes around voluntary tax compliance. For managers and practitioners within Enugu State, the study provides practical insight into how digitalization of tax administration can be better managed. Finally, it contributes to the academic literature on accounting by extending existing knowledge into a specific empirical context, and offers a reference point for future researchers.

1.6 Scope of the Study

In terms of scope, this study confines itself to Enugu State, focusing specifically on how digitalization of tax administration relates to voluntary tax compliance within that setting. Findings are interpreted within these boundaries rather than as universal claims applicable to every organization or market.