ABSTRACT

Personal income tax is a major source of revenue to government as government uses it to provide

amenities to its citizen. This necessitated the study in the effect of personal income tax evasion on

revenue generation in Abia State. The study made use of survey and historical research design as

questionnaire and data of budgeted and actual personal income tax revenue were source from Abia

State Board of Internal Revenue ranging 2001-2015. The data analysis techniques use was paired

sampled test and correlation analysis. The result revealed that there is a signticant difference

between budgeted and actual personal income tax which attributed to tax evasion. The correlation

analysis showed that there is a signflcant relationship between budgeted and actual personal

income tax. The study, therefore conclude and recommend that since tax collection in the state is

based on pay as you earn that government should employed other tax collection machineiy to boast

collection of personal income tax as the state has less number of private sector thus making firms

and individual to evade tax which result to low development in the state.