TAX COMPLEXITY, CORRUPTION AND REVENUE GENERATION IN NIGERIA: A THERMODYNAMIC THEORETICAL FRAMEWORK

This study examines the effects of tax complexity and corruption on tax revenue generation in Nigeria, framed within the thermodynamic theory of tax compliance. Using a quantitative cross-sectional research design, data were collected from a population of registered taxpayers and tax officials across Nigeria, with a final sample of 400 respondents. A multi-stage sampling technique was applied to ensure both representativeness and expert insight across key taxpayer categories.

Descriptive statistics summarized perceptions of tax complexity, corruption, and compliance, while correlation and multiple regression analyses tested the thermodynamically modeled relationships among complexity, corruption, and revenue. The findings reveal that tax complexity and corruption both have statistically significant negative effects on revenue generation, while tax compliance positively and significantly influences revenue outcomes. These results confirm the theoretical expectation that increased complexity and corruption introduce systemic disorder, reduce efficiency, and erode compliance, thereby weakening overall revenue performance. In contrast, improved compliance reflects a restoration of systemic balance and leads to stronger revenue outcomes.

Based on these results, the study recommends simplifying tax laws and procedures to reduce compliance burdens and institutional resistance. It further advocates for the automation and digitalization of tax processes, along with robust anti-corruption enforcement, to strengthen transparency and accountability. Finally, promoting voluntary compliance through public education and taxpayer service enhancement is critical to optimizing the thermodynamic balance of the tax system. These interventions are essential to improving Nigeria’s revenue generation capacity and fostering a more resilient, equitable fiscal framework.