- Introduction
- Background to the study
The political, economic and social development of any country depends on the amount of revenue generated for the provision of infrastructure in that given country. According to AZUBIKE (2009), tax is a major player in every society of the world. The Nigerian tax system is lopsided and dominated by oil revenue. According to Statistics from the Central Bank of Nigeria (2000), oil and gas exports accounted for more than 98 percent of export earnings and about 83 percent of federal government revenue, as well as generating more than 40 percent of its GDP. It also provides 95 percent foreign exchange earnings. Therefore, a highly lucrative means of generating the amount of revenue needed for providing the necessary infrastructure for our country through tax is no doubt through a well-structured tax system.
According to the Presidential Committee on National tax policy (2008), the central objective of the Nigerian tax system is to contribute to the well-being of all Nigerians directly through improved policy formulation and indirectly though appropriate utilization of tax revenue generated for the benefit of the people. Over the years our tax system has not been able to reach these perceived objectives as a result of some setbacks and challenges some of which include lack of stewardship amongst tax payers, multiplicity of taxes, complex tax payment system and tax offsetting, lack of technological exposure, tax evasion, corruption, government instability
which instigates noncompliance with relevant tax laws, poor information base and record keeping etc.