TAX REFORMS AND REVENUE GENERATION IN NIGERIA; A LONGITUDINAL ANALYSIS

CHAPTER ONE

BACKGROUND OF THE STUDY

According to the report of the presidential committee on National Tax policy (2008), Tax policy formulation in Nigeria is the responsibility of the Federal inland Revenue Services (FIRS), Customs, Nigerian National Petroleum Corporation (NNPC), National Population Commission (NPC), and other agencies but under the guidance of the National Assembly i.e. the law making body in Nigeria (Presidential committee on National tax policy, 2008). Suffice it to say that if there must be any effective implementation of the Nigerian tax system or attainment of its goal, the use of the national tax policy document remain absolutely essential. According to the Presidential Committee on tax policy (2008), “Nigeria needs a tax policy which does not only describe the set of guiding rules and principles, but also provide a stable point of reference for all the stakeholders in the country and upon which they can be held accountable. James and Nobes (2008) decried the inability of tax policy to meet up with efficiency and equity criteria against which it is being judged. It was further noted that tax policy is continually subjected to pressure and changes which most time does not guarantee outcome that are in line with the overall goal (James and Nobes 2008). Unfortunately, most policy changes in Nigeria are without adequate consideration of the taxpayers, administrative arrangement and cost plus the existing taxes. This has in no small measure hindered the effective implementation and goal congruence of the nation’s tax system. Citing (Bird and Oldman 1990), James and Nobes (2008) stated as follows “

STATEMENT OF THE PROBLEM

The problem confronting this research is to determine the nature of tax reforms and its impact on revenue generation in Nigeria, applying a longitudinal analysis.

 RESEARCH QUESTIONS

1     What constitute tax reforms in Nigeria?

2      What is the effectiveness of tax reform towards revenue                  generation in Nigeria?

OBJECTIVE OF THE STUDY

1. To determine the nature of tax reform in Nigeria
2. To determine the effectiveness of tax reform policy towards     revenue generation to government

SIGNIFICANCE OF THE STUDY

The study shall analyze tax reform policy and determine its effectiveness towards revenue generation to government.

It shall also serve as a source of information on issues of tax reforms in Nigeria

STATEMENT OF HYPOTHESIS

H0    Tax revenue generation in Nigeria   is high

H1    Tax   revenue generation in Nigeria is low

H0    challenges to tax revenue generation in Nigeria is low

H1    Challenges to tax revenue generation in Nigeria is high

H0    The impact of tax reform on revenue generation is low

H1    The impact of tax reform on revenue generation is high

DEFINITION OF TERMS.

According to the report of the presidential committee on National Tax policy (2008), Tax policy formulation in Nigeria is the responsibility of the Federal inland Revenue Services (FIRS), Customs, Nigerian National Petroleum Corporation (NNPC), National Population Commission (NPC), and other agencies but under the guidance of the National Assembly i.e. the law making body in Nigeria (Presidential committee on National tax policy, 2008). Suffice it to say that if there must be any effective implementation of the Nigerian tax system or attainment of its goal, the use of the national tax policy document remain absolutely essential. According to the Presidential Committee on tax policy (2008), “Nigeria needs a tax policy which does not only describe the set of guiding rules and principles, but also provide a stable point of reference for all the stakeholders in the country and upon which they can be held accountable.

Taxation:

Taxation has been defined as a general concept for devices used by government to extract money or other valuables from members of the community and organization by use of law. It is a levy charged by government either central, state,or local government on income, property,commodities and services.