COMPARATIVE ANALYSIS OF VALUE ADDED TAX REVENUE AMONG DIFERENT SECTOR IN NIGERIA (CASE STUDY OF FEDERAL INLAND REVENUE LAGOS STATE)
ABSTRACT
The research provides a conceptual and analytical study on comparative analysis of value added tax revenue among dierent sector in Nigeria, focusing on the case study of Federal Inland Revenue, Lagos State. The study assesses the performance of the different sector in the Nigerian economy in contribution to VAT revenue with a view to showcase their effect on economic growth.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Tax can be defined as a compulsory contribution to the support of government levied on persons, property, income, commodities, transactions et. Now at a fixed rate mostly proportionate to the amount on which the contribution is levied (Crowther 1998) as it can equally be confirmed in (Tilley 1981) Oyebunji (2006) identified two major forms of taxes these are:
1. Direct taxes: These are taxes imposed by the government on the income of individuals and companies which are usually paid by the person or persons on whom it is legally imposed. Examples are Personal Income Tax (PIT), Company Income Tax (CIT), Capital Gains Tax (CGT), Withholding Tax, Petroleum Profits Tax (PPT), Education Tax and Capital Transfer Tax (CTT). The PPT is imposed on individuals earning, CIT on profits of
organization/corporate bodies, PPT on oil purchasing/exploration companies, CGT on profit from sales of capital assets and CTT in the transfer of property inter-viro and transfer in death. However, CTT in profit was abrogated in 1996.
2. INDIRECT TAX: These are taxes by the government on goods and services.Indirect taxes can be avoided because it is payable only if one buys the commodities or enjoys the services on which the tax is imposed and it involves little administrative cost compared to direct taxes. It does not create disincentive to efforts
as in the case of direct taxes and hence does not affect the economic functions of the tax payers.
Examples of the indirect taxes in Nigeria according to Oyebunji (2006) are:
1. Import duties/traics:
Levied on goods imported into the country.
2. Export goods: levied on goods produced for export.
3. Excise goods: Imposed on specific goods produced in a country.
4. Consumption tax: levied on the purchase of any commodity or enjoyment of a service.
Examples are sales taxes and Value Added Tax (VAT), the characteristics effect
of consumption tax is that it is not included in the price tag by the affected
commodity rather it is added as a percentage of the total of invoice in the goods or services rendered.
However, this research aims to provide a comparative analysis of Value Added Tax Revenue among dierent
sector in Nigeria, A case study of Federal Inland Revenue of Lagos State.
