IMPACT OF EFFECTIVE TAX ADMINISTRATION ON NIGERIA ECONOMY
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Tax administration involves interpretation of tax laws and execution of the requirement. Referring to Agbetunde L.A. in the textbook “Nigerian Personal Income Tax (2004). Tax Administration had been existing in Nigeria before we were colonized. It started from north when the colonialists did a sort of consolidation and codification of existing taxation in 1902. the colonialist did these through various policy regulations encoded in the Native Court Regulation (1902) and Native Revenue Proclamation.
After the amalgamation of the Northern and Southern provinces in 1914, the Native Revenue Ordinance was enacted in 1917 in the north and 1918 in the south. There was a problem in that these ordinances were applicable to specific sections of the country.
In 1951, Raisman Fiscal Commission was set up to look into fiscal issues and the country to solve the problems of inconsistency and confusion where not in the exiting laws. Raisman Commission provided on recommendation that there should be uniformity in taxation and thus from a basis of modern tax system and was contained in the 1960 constitution.
This was enacted into law via Income Tax Management (ITMA) of 1961. This Act provided for the administration of both individual and company tax, from this came the gradual reduction of the role of local authority in tax administration as the move was towards the federal and state governments. The federal is to administer income of limited companies while both federal and state are to administer Personal Income Tax (PIT).
More reforms came through the constitutional reforms of 1963, 1979 and 1989 as more and more responsibility for tax administration is put on shoulder of the federal governments. Further amendments were made on the Act in 1979 and 1990 constitution.
1.2 STATEMENT OF PROBLEM
Here, we will look into the effectiveness of tax administration on Nigeria. Tax administration is encountered with so many problems such as untimely remittance of tax collected by agent. Another problems is the failure of some organisation to register and pay tax on themselves as the law requires, also some professionals like lawyers, accountants and estate agent to mention a few.
1.3 THE PURPOSE OF THE STUDY
According to Prince Adejuwon Jonathan, in the textbook “Analysis of Taxation”. This project is aimed at providing information on the impact of effective tax administration on Nigeria Economy. Here are some facts which will assists to understand the implementation of tax in Nigeria:
i. Tax is paid by all chargeable persons and cooperate organisation.
ii. Tax charged on income of person other than company is referred to as “Personal Income Tax (PIT). The income charged under this tax are income of individuals (either as an individual or in partnership) from sources like employment, trading, business etc.
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