CHAPTER ONE
HISTORICAL BACKGROUND OF THE STUDY
1.1 INTRODUCTION
The word tax first appeared in the English language only in the 14th century, it is derived from the Latin word tax are, which means to “Assess” before that, English used the related word task derived from old French, for a while task and tax were both in common use, the first requiring labour, and the second money. In the Stone Age, tax was collected in Nigeria long before the coming of Europeans; it was collected by the local Chief for the purpose of administration and defense. Every one was expected to give part of his or her proceeds from cultivation of land to the state, those who were not cultivating were required to give their human (labour) sources for public work such as clearing the bush, digging the pit latrine, wells etc. for the benefit of the community, as a whole. Failure to render such services usually resulted in loss of property which might be reclaimed after payment.
With the coming of the Europeans, taxes were collected from individuals through local chief in 1964; a legislative council was set for the whole country which obliged the regional council with a large measure of financial responsibility. After independence, state government were to fine out other sources of generating revenue which is today known as pay as you earn (PAYE). Tax is a levy imposed by the federal board of Inland Revenue (federal government) on the chargeable income generated by individuals, organizations and other corporate bodies for the betterment of the society as a whole. Taxation is the act of taxing, it is also the amount assessed as a tax, it is revenue raised from taxes. Taxation is the means of progress through which the government generate revenue for national development through the contribution by the citizens. According to Ogundele (1999) taxation is defined as a process or machinery by which communities or group of persons are made to contribute in some agreed amount of money for the propose of the administration and development of the society. It can be inferred that the payment of tax will in turn be beneficial to the entire community of they pay their tax properly.
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