1.1 BACKGROUND OF THE STUDY
The tax system is often identified as one of the most powerful levers available to the government to move their economic state from a pitiable condition to a happier position. According to Anyanwu (1999) taxation can simply be seen as “a compulsory transfer of money from private individuals, institution or groups to the government”. On another note Agolu (2001) says “taxation may be defined as a compulsory levy by the government through its various agencies in the income capital or consumption of its subjects. These levies are made on personal income such as salaries business profits, interest, dividends commission royalties or rests. It may also be levied on capital gains and petroleum profits. All of the above are taxes levied on income”. Income tax is one levied on the income after allowances have been granted what remains taxable. The questions then arises as how efficient is the administration of income tax in Nigeria and Abia State in particular. This is the questions this research work tries to provide an answer to. It is important to note that during colonial period, income tax administration was placed on the shoulders of colonial masters according to the orders of the governor general. After independence, the government of Nigeria took over administration of taxes, especially, income tax. Consequently, board of internal revenue were established in the different regions and states of the federation. These states were charged with responsibility of income tax administration.