Artificial Intelligence and Tax Compliance in Nigeria: A Comprehensive Review of Digital Detection, Informal Economy Evasion, and Revenue Assurance

Vollständiger Abstract

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Purpose: This review examines how artificial intelligence can strengthen tax compliance, digital detection, informal economy monitoring, and revenue assurance in Nigeria. It focuses on the extent to which AI supported systems can improve taxpayer visibility, identify noncompliance, reduce revenue leakage, and support more effective tax administration. Research Method: A comprehensive review of literature and institutional evidence published between 2021 and 2026 was undertaken, with emphasis on Nigerian empirical studies, official sources, and relevant international comparative evidence. The review considered digital tax administration, electronic filing, e invoicing, tax risk assessment, audit analytics, informal sector taxation, artificial intelligence, and data integration. Results and Discussion: The evidence indicates that AI tools, including risk scoring, anomaly detection, network analysis, text analytics, geospatial analysis, and automated decision support, can improve the identification and prioritization of compliance risks. Their effectiveness depends strongly on reliable, integrated, and identity linked data. Digital tax infrastructure, including TaxPro Max, e invoicing, electronic payment systems, and connected taxpayer records, can strengthen traceability, invoice validation, payment matching, audit selection, and revenue assurance. AI also offers practical opportunities for detecting observable patterns of noncompliance within Nigeria’s highly informal economy. However, significant risks remain concerning data quality, explainability, fairness, privacy, due process, model validation, and excessive reliance on automation. Implications: Nigeria should integrate AI within a governed digital tax architecture that combines technological capability with effective taxpayer services, institutional capacity, human oversight, transparent procedures, and measurable performance indicators. Originality: This review provides an integrated Nigerian perspective linking AI enabled detection, informal economy compliance, digital tax infrastructure, revenue assurance, and governance safeguards within a unified tax administration framework