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Research Paper | Accounting | Volume 15 Issue 9, September 2026 | Pages: 568 - 579 | Nigeria
Digitalisation and Tax Revenue Generation: The Moderating Role of Institutional Quality in Nigeria
Abstract: This study examined the moderating role of institutional quality in the relationship between digitalisation's effect on tax revenue generation in Nigeria, motivated by persistent oil dependence, fiscal deficits, and low tax-to-GDP ratios despite e-tax reforms which threatened fiscal sustainability, using annual data from 2003 to 2024. The study employed quantitative longitudinal research design. Following Philip-Perron unit root tests that confirmed a mix of integrated variables, the Autoregressive Distributed Lag (ARDL) model was utilized to analyze short-run and long-run dynamics. The empirical results indicated that digitalisation did not independently exert a statistically significant influence on tax revenue. Furthermore, while the interaction between digitalisation and institutional quality produced a positive coefficient, the effect remained statistically insignificant in both the long run and short run. Global oil prices remained the dominant driver, confirming the national budget remained structurally tethered to international energy market volatility. The consistently significant negative error correction terms across all models confirmed a long-run equilibrium relationship. The study concluded that institutional quality does not significantly moderate the relationship between digitalisation adoption and tax revenue in Nigeria. The study recommended that the Nigerian government prioritize the enhancement of institutional frameworks and administrative oversight to address governance deficiencies. Policymakers should transcend mere technological acquisitions by amalgamating digital tax instruments with robust accountability mechanisms and pursuing assertive non-oil diversification strategies to disentangle fiscal health from oil markets.
Keywords: Institutional quality, digitalisation, tax revenue, ARDL Model
How to Cite?: Anzule Ewuga, Isah Shittu, Aliyu Baba Usman, "Digitalisation and Tax Revenue Generation: The Moderating Role of Institutional Quality in Nigeria", Volume 15 Issue 9, September 2026, International Journal of Science and Research (IJSR), Pages: 568-579, https://www.ijsr.net/getabstract.php?paperid=SR26727154021, DOI: https://dx.doi.org/10.21275/SR26727154021