THE IMPACT OF TAXATION ON NIGERIA ECONOMY
CHAPTER ONE
INTRODUCTION
1.1. BACKGROUND OF THE STUDY
One of the major functions of the government especially developing countries such as Nigeria is the provision of infrastructural services such as electricity, schools, hospitals, pipe-borne water, good roads and as well as ensure a rise in per-capital income, poverty alleviation to mention a few. For these services to be adequately provided, government should have enough revenue to finance them. The task of financing these enormous responsibilities is one of the major problems facing the government. Based on the limited resources of government, there is need to carry the citizens (governed) along hence the imposition of tax on all taxable individuals and companies/organizations to augment government financial position is essential. To this end, government have always enacted various tax laws and reformed existing ones to stand the taste of time. These laws include: Income Tax Management Act (ITMA), Companies Income Tax Decree (CITD) etc.
All these are aimed at ensuring adherence to tax payment and discouraging tax evasion and avoidance. For the purpose of this study, the researchers would be concerned with the impact of taxation on Nigeria economy.
1.2. STATEMENT OF THE PROBLEM
The first need of any modern government is to generate enough revenue which is indeed “the breath of its nostrils”. Thus, taxation is by far one the most significant source of revenue for the government. Nigerians regard payment of tax as a means through which government raises revenue on herself at the expense of their sweat.
It is good to note that no taxation succeeds without the tax payers’ co-operation. Here, we can ask some thought – provoking questions such as:
What makes taxation such a difficult issue?
Why do people feel cheated when it comes to tax?
Is government making judicious use of taxpayers’ money?
