TABLE OF CONTENTS
CHAPTER
ONE
1.0 Introduction
1.1 Background to the Study
1.2
Statement
of Problem
1.3 Aim and Objectives of the Study
1.4 Relevant Research
Questions
1.5 Relevant Research Hypotheses:
1.6 Scope of the Study
1.7 Significance of the
study
CHAPTER TWO
2.0 LITERATURE
REVIEW
2.1 Preamble
2.2 Theoretical
Framework
2.3 Empirical
Review of Related Literatures
2.3.3 Conceptual
Framework
2.3.4 Functions of
a Good Tax Administration
2.4 The Principles of Taxation
2.5 Objectives of
Taxation
2.6 The
Responsibilities of Government with respect to Taxation
2.7 Features of the
Nigerian Tax System
2.8 Problems of Tax
Administration
2.9 Forms of Tax in
Nigeria
CHAPTER THREE
RESEARCH METHODOLOGY
3.1 Preamble
3.2 Research Design
3.3 Population of the Study
3.4 Sampling,
Procedure and Sample Size
3.5 Data
Collection Instrument and Validation
3.6 Method of Data Analysis
3.7 Limitation of the
Methodology
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
4.0 Preamble
4.1 FREQUENCY
DISTRIBUTION OF BIO DATA OF RESPONDENTS
4.2 FREQUENCY
DISTRIBUTION OF RESPONDENTS OPINION ACCORDING TO RESEARCH QUESTIONS
CHAPTER FIVE
5.0 SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 Summary of Findings
5.2 Conclusion
5.3 Recommendations
QUESTIONNAIRE
CHAPTER
ONE
1.0 Introduction
1.1 Background
to the Study
Taxation
is seen as a burden which every citizen must bear to sustain his or her
government because the government has certain functions to perform for the
benefits of those it governs (Afuberoh and Okoye, 2014). A précised definition
of taxation by Farayola (1987) is that taxation is one of the sources of income
for government, such income as used to finance or run public utilities and
perform other social responsibilities. Ochiogu (1994) defines tax as a levy
imposed by the government against the income, profit or wealth of the
individuals and corporate organizations.
According
to Adams (2001) taxation is the most important source of revenue for modern
governments, typically accounting for ninety percent or more of their income.
Taxation is seen by Aguolu (2004), as a compulsory levy by the government
through its agencies on the income, consumption and capital of its subjects.
These levies are made on personal income, such as salaries, business profits,
interests, dividends, discounts and royalties. It is also levied against
company’s profits petroleum profits, capital gains and capital transfer.
Whereas, Ojo (2008) stresses that, taxation is a concept and the science of
imposing tax on citizens. According to him, tax is itself a compulsory levy
which is required to be paid by every citizen. It is generally considered as a
civic duty. The imposition of taxation is expected to yield income which should
be utilized in the provision of amenities, both social and security and creates
conditions for the economic well-being of the society. Okon (1997) states that
income tax can be regarded as a tool of fiscal policy used by government all
over the world to influence positively or negatively particular type of
economic activities in order to achieve desired objectives. The primary
economic goals of developing countries are to increase the rate of economic
growth and hence per capita income, which leads to a higher standard of living.
Progressive tax rate can be employed to achieve equitable distribution of
resources. Government can also increase or decrease the rates of tax, increase
or decrease the rate of capital allowances (given in lieu of depreciation) to
encourage or discourage certain industries (e.g. in the area of agriculture,
manufacturing or construction) or may give tax holidays to pioneer companies.
Income tax therefore can be used as an agent of social change if employed as a
creative force in economic planning and development.
Revenue
generation in Nigeria local governments is principally derived from TAX.
Meanwhile tax is a compulsory levy imposed by government on individuals and
companies for the various legitimate function of the state (Olaoye, 2008). Tax
is a necessary ingredient for civilization. The history of man has shown that
man has to pay tax in one form or the other that is either in cash or in kind, initially
to his chieftain and later on a form of organized government (Ojo, 2003). No
system or rules can be effective whether foreign or nature unless it enjoys
some measures of financial independence.
Local
governments in Nigeria has developed over a number of years. Historically, the
development of direct taxation in local government in Nigeria can be traced to
the period before the British pre-colonial period. Under this period, community
taxes were levied on communities (Rabiu, 2004) recently the revenue that
accrues to local government is derived from two broad sources, viz: the
external sources and the internal sources.
External
sources of local government finance includes: Statutory allocation from
the Federal Account in accordance with section 160 (2) of the constitution of
the Federal Republic of Nigeria (Promulgation) Decree 1989. Statutory
allocation from each state government to the local governments in its areas of
jurisdiction, Federal Grants-in-aid, State-Grants-in-aid, Borrowing from state
government and other financial institutions, Local Rates on markets and shops,
while internally generated source of finance includes; local rates, markets
taxes and levies excluding any market where state finance is involved, Bicycle,
truck canoe, wheelbarrow and cart fees, other than a mechanical propelled
truck, Permits and fines charged by Customary Courts Local Government Business
Investment, Tenement Rate Fees from schools established by the local
governments Shops and kiosks rate, on and off Liquor Licence fees, Slaughter
slab fees, Marriage, birth and death registration fees.
Naming
of street registration fee, excluding any street in the state capital, Right of
occupancy fees on lands in the rural areas, excluding those collectable by the
federal and state governments excluding the state capital, Cattle tax payable
by cattle farmers only, Merriment and road closure levy, Religious places
establishment permit fees.
Signboard
and advertisement permit fees, Radio and Television licence fees (other than radio
and television transmitter), Vehicle radio licence fees (to be imposed by the
local government of the state in which the car is registered), Wrong parking
charges.
Public
convenience, sewage and refuse disposal fees, Customary burial ground permits
fees, Fees collected from amusement centers established and operated by the
local authority and that of Tourist centers and Tourist attractions, Rents,
Fees on Private Institution, Motor park levies, Domestic and licence fees etc.
Inspite of the above sources of revenues, Local government is faced with
varieties of difficulties to source adequate revenue from federal government,
state government and the internally generated revenue, such problems are
cogwheel to the smooth running of local government administration.
They
are the dishonesty on the part of officers collecting the revenues, such as
cases of printing receipts by the officers had been the major problem in
releasing the expected revenues.
The
machinery put in place for collection of revenue is inadequate hence, most of
the government money is not collected and this is in case of the internally
generated funds. Meanwhile, as government is the means by which the common
problems and needs of a community constituting a country are economically
catered for, so as local community revolves jointly those common problems and
needs, which could have been difficulty to solve individually. The very
objective of having local representation is in order that those who have an
interest in body of their country men may manage that joint interest by
themselves. This is why every state find it desirable to create local
government councils to provide and deliver local public goods and services
hasten development (Olaoye, 2006) and bring government closer to the people.
1.3 Statement
of Problem
Afuberoh
and Okoye(2014) observed that over the years, revenue derived from taxes has
been very low and no physical development actually took place, hence the impact
on the poor is not being felt. Inadequate tax personnel, fraudulent activities
of tax collectors and lack of understanding of the importance to pay tax by tax
payers are some of the problems of this study. The issues mentioned above will
therefore constitute the problem to be addressed by this research study.
1.3 Aim
and Objectives of the Study
The
broad objective of this study is to critically assess the Taxation as a major
source of revenue genera in Nigeria, using Lagos Internal Revenue Scheme as a
study, specifically the study will also to:
i)
determine the extent taxation has
contributed to revenue generation in Nigeria
ii)
examine the extent taxation has
contributed to the steady growth in Gross Domestic Product in Nigeria
iii)
determine how Nigeria can revolutionalise
her tax system in order to boost revenue generation through this source
iv)
determine sources of tax in Nigeria
1.4 Relevant Research
Questions
The principal question of this research
is: Is tax the major source of revenue generation? This research will also try
to provide answers to the following sub-questions in the course of this study:
i) What
extent has taxation contributed to revenue generation in Nigeria?
ii) What extent has taxation contributed to the
steady growth in Gross Domestic Product in Nigeria?
iii) In
what ways can Nigeria revolutionalised her tax system in order to boost revenue
generation through this source?
iv) What
are the sources of tax in Nigeria?
1.5 Relevant Research Hypotheses:
This
study will test the following Hypotheses in order to do justice to this
research:
H01:
Taxation has not contributed significantly on revenue generation in Nigeria.
H02:
Taxation has not contributed significantly to the steady growth in Gross
Domestic Product in Nigeria.
1.6 Scope
of the Study
The
Present study will focus on fathoming the social as well as the economic effect
of the Local Government with respect to Ajeromi-Ifelodun, Lagos state.
1.7
Significance of the study
This
research study will be significant in the following areas:
It
will create a better understanding of the roles and functions of Local
Government Administration
It
will elucidate on the essence of establishing Local Government Administration
It
will also help the citizens to understand how the establishment of LGAs affect
them socially and economically.
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