Abstract
This study examined the relationship between electronic invoicing adoption and Value Added Tax (VAT) compliance among registered businesses in Nigeria. The introduction of electronic invoicing by the Federal Inland Revenue Service (FIRS) represents a significant milestone in Nigeria's digital tax administration reforms aimed at improving tax transparency, reducing revenue leakages, and enhancing voluntary tax compliance. The electronic invoicing system enables real-time generation, validation, and transmission of invoices, thereby providing tax authorities with timely access to transaction data and strengthening VAT administration. Despite these anticipated benefits, the level of adoption among businesses and its influence on VAT compliance remain underexplored, particularly as the system is being implemented in phases across different categories of taxpayers. The study adopted a quantitative research design using primary data collected through structured questionnaires administered to registered businesses in Nigeria. The target population comprised VAT-registered businesses across selected sectors of the economy, while an appropriate sampling technique was employed to select respondents. Electronic invoicing adoption was measured using indicators such as system integration, perceived ease of use, technological readiness, and management support, whereas VAT compliance was assessed through timely VAT registration, accurate VAT computation, prompt filing of VAT returns, and timely remittance of VAT liabilities. Data collected were analysed using descriptive statistics, correlation analysis, and multiple regression to determine the extent to which electronic invoicing adoption influences VAT compliance. The study is expected to reveal that higher levels of electronic invoicing adoption significantly improve VAT compliance by reducing errors in tax reporting, enhancing transaction transparency, increasing record accuracy, and limiting opportunities for tax evasion. The findings are also expected to demonstrate that businesses with greater technological readiness and stronger management commitment exhibit higher compliance with VAT regulations than businesses with lower levels of digital adoption. The study concludes that electronic invoicing constitutes an effective digital tax administration tool capable of strengthening VAT compliance among registered businesses in Nigeria. It recommends that the Federal Inland Revenue Service should intensify taxpayer education, expand technical support, improve digital infrastructure, and provide incentives that encourage the widespread adoption of electronic invoicing across businesses of all sizes. These measures will contribute to improved tax administration, enhanced government revenue generation, and greater transparency within Nigeria's tax system.
Keywords: Electronic invoicing, Value Added Tax, VAT compliance, digital tax administration, electronic fiscal system, registered businesses, Nigeria.
