Overview of penal response towards tax compliance in Nigeria

Tax offences and penalties are created to tackle tax non-compliance. Tax penalties bear civil liabilities while tax offences portends criminal sanctions. This paper employs the deterrence theory of penalty to determine whether tax penalties and enforcement agencies are effective in ensuring tax compliance in Nigeria. It is found that the dwindling economic situation in the country has diminished the deterrent effect of pecuniary tax sanctions. Hence, there is need to review the tax statutes. Corroborative effort between tax authorities would facilitate the probability of detection and punishment of tax offenders, thereby improving tax compliance in Nigeria.