SMEs' View on the Theory of Planned Behaviour and Penalty Magnitude: Preliminary Findings from Nigeria

• Main Authors: Hannatu Yohanna Gimba, Idawati Ibrahim
• Format: Article
• Language: English
• Published: CSRC Publishing 2017-06-01
• Series: Journal of Business and Social Review in Emerging Economies
• Online Access: http://publishing.globalcsrc.org/ojs/index.php/jbsee/article/view/180

Purpose: This paper investigates the relationship between penalty magnitude, attitude towards VAT compliance, subjective norms and perceived behavioural control on VAT compliance intention among SMEs in Nigeria. Methodology: Data was gathered through administration of 30 questionnaires. The respondents are SMEs in Kano, Nigeria. 23 indicator items were measured on 5-point Likert Scale from 1 (strongly disagree) to 5 (strongly agree). IBM SPSS Statistics 23 was employed as the primary statistical analysis tool for the study. Findings: The result indicates positive relationship of penalty magnitude, subjective norms and perceived behavioural control on VAT compliance intention, while attitude towards VAT compliance has negative relationship with VAT compliance intention. Implications: This study recommends a blend of economic and socio-psychological factors in tackling VAT compliance among SMEs, as that will encourage the SMEs to remit the VAT collections and also assist the policy makers to map-out policies that would ensure an effective management of VAT revenue and compliance among SMEs in Nigeria and other developing countries. Further studies on a larger number of respondents should be conducted to test the consistency of the results.