E-taxation Administration in Nigeria: Problems & Prospect: a Case Study of Imo State Board of Internal Revenue, Owerri
CHAPTER ONE
OBJECTIVE OF THE STUDY
The main objective of the study is to find out the problems that have been militating against e-taxation administration in Nigeria.
Other sub-objectives of the study include;
- To find out the causes of poor revenue collection in Nigeria.
- To examine if e-taxation administration will be more efficient when separated from the civil service.
- To identify if poor e-taxation collection is because of pronounced poverty among the tax paying public in Nigeria.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
Conceptual Review
Electronic taxation
Electronic taxation (or e-taxation) is the deployment of computer systems and networks in the process of levying and payment of taxes. It involves the application of computer techniques in the process of tax assessment, collection and administration, generally referred to as e-payments and e-filing. Electronic taxation is an extension of the growing concept of e-governance and e-commerce. It involves the exchange of data through information communication technology systems between the taxpayer and the tax authorities. The objective of e-taxation “is to replace cumbersome manual, bureaucratic service systems, with collaborative, efficient, process-driven and secure on line delivery systems”. E-taxation was first introduced in the US by the IRS as an electronic filing test program involving five tax preparers.6 However, electronic taxation was fully entrenched in the US by the introduction of the Internal Revenue Service Restructuring and Reform Act 1998. The IRS adopted measures to ensure that all electronically prepared returns could be filed electronically and, by 2012, it had achieved more than 80% electronic tax filing. From the US, e-taxation has spread to other countries and, according to the Paying Taxes: 2018 Report, 92 economies had fully implemented electronic tax filing and payment systems as at 2016. In the last 20 years, there has been a consistent shift from manual tax processes to an electronic tax system in most parts of the world. For instance, the Republic of Korea launched their electronic tax system in 2012 while Uruguay’s compulsory electronic payment of national tax was introduced in 2014 and China launched its electronic taxation in 2015. India introduced electronic taxation in September 2004, initially on a voluntary basis but it was made mandatory for all categories of taxpayers in July 2006. This was followed by Serbia in 2014 and Namibia in 2016.11 Several African countries have also adopted the electronic tax system in their operations. For instance, electronic taxation was introduced in Ethiopia in 2012. The introduction of electronic taxation in Ethiopia was a product of the collaboration between the Investment Climate Facility in Africa (ICF) and the Ethiopian Government, represented by the Ethiopian Revenue and Customs Authority (ERCA), to improve the investment climate in Ethiopia.
CHAPTER THREE
RESEARCH METHODOLOGY
INTRODUCTION
In this chapter, we described the research procedure for this study. A research methodology is a research process adopted or employed to systematically and scientifically present the results of a study to the research audience viz. a vis, the study beneficiaries.
RESEARCH DESIGN
Research designs are perceived to be an overall strategy adopted by the researcher whereby different components of the study are integrated in a logical manner to effectively address a research problem. In this study, the researcher employed the survey research design. This is due to the nature of the study whereby the opinion and views of people are sampled. According to Singleton & Straits, (2009), Survey research can use quantitative research strategies (e.g., using questionnaires with numerically rated items), qualitative research strategies (e.g., using open-ended questions), or both strategies (i.e., mixed methods). As it is often used to describe and explore human behaviour, surveys are therefore frequently used in social and psychological research.
POPULATION OF THE STUDY
According to Udoyen (2019), a study population is a group of elements or individuals as the case may be, who share similar characteristics. These similar features can include location, gender, age, sex or specific interest. The emphasis on study population is that it constitutes of individuals or elements that are homogeneous in description.
This study was carried to examine E-taxation administration in Nigeria: problems & prospect. Imo state board of internal revenue, Owerri forms the population of the study.
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
INTRODUCTION
This chapter presents the analysis of data derived through the questionnaire and key informant interview administered on the respondents in the study area. The analysis and interpretation were derived from the findings of the study. The data analysis depicts the simple frequency and percentage of the respondents as well as interpretation of the information gathered. A total of eighty (80) questionnaires were administered to respondents of which only seventy-seven (77) were returned and validated. This was due to irregular, incomplete and inappropriate responses to some questionnaire. For this study a total of 77 was validated for the analysis.
TEST OF HYPOTHESIS
H0: there are no causes of poor revenue collection in Nigeria
H1: there are causes of poor revenue collection in Nigeria
H0: e-taxation administration will not be more efficient when separated from the civil service
H2: e-taxation administration will be more efficient when separated from the civil service
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
Introduction
It is important to ascertain that the objective of this study was to ascertain E-taxation administration in Nigeria: problems & prospect: a case study of Imo state board of internal revenue, Owerri. In the preceding chapter, the relevant data collected for this study were presented, critically analyzed and appropriate interpretation given. In this chapter, certain recommendations made which in the opinion of the researcher will be of benefits in addressing the challenges of E-taxation administration in Nigeria: problems & prospect
Summary
This study was on E-taxation administration in Nigeria: problems & prospect: a case study of Imo state board of internal revenue, Owerri. Three objectives were raised which included: To find out the causes of poor revenue collection in Nigeria, to examine if e-taxation administration will be more efficient when separated from the civil service and to identify if poor e-taxation collection is because of pronounced poverty among the tax paying public in Nigeria. A total of 77 responses were received and validated from the enrolled participants where all respondents were drawn from Imo state board of internal revenue, Owerri. Hypothesis was tested using Chi-Square statistical tool (SPSS).
Conclusion
This research has shown that innovations in information and communication technology have drastically altered the way people interact and do business. The effect of modern technology can be felt in virtually every area of human life, from simple social or business interactions to complex or multifaceted exchanges. The tax authorities in Nigeria, propelled by the need to optimise their effectiveness in service delivery, adopted the electronic tax system pursuant to their powers to introduce and review policies for the effective administration of taxes. The introduction of computer systems and network technology in tax administration, notwithstanding its obvious advantages, has also raised new concerns of cybercrimes and cybersecurity issues. Considering the fact that electronic taxation is dependent on internet and computer systems, it is exposed to activities of hackers, virus, malware and ransomware vendors, manipulation of data, false statements and declarations online to reduce tax liabilities. Nigerian’s electronic tax system is vulnerable to attacks, considering that several Nigerians have been convicted of electronic tax fraud in other countries, and it is rated as number three in the global cybercrimes index. In Nigeria, cyber tax crimes were not contemplated by the existing tax laws, and thus reliance must be placed on the provisions of the Cybercrimes Act to protect electronic tax systems and networks. Experience from other countries indicates that the enforcement of cybercrime laws and the strengthening of relevant institutions are effective strategies to fight electronic tax fraud. Thus, it is important for tax authorities to collaborate with the office of the National Security Adviser to form the necessary synergy to protect electronic tax systems in Nigeria. This will help tax authorities to benefit from the efforts of relevant cybercrime protection and prevention agencies in combating cybercrime, considering that these agencies are saddled with the responsibility to evolve strategies to prevent and combat cybercrime in Nigeria.
Recommendation
It is therefore recommended that the FIRS(E) Act should be amended to provide a comprehensive legislative framework for electronic taxation in Nigeria. Also, the Cybercrimes Act should be amended specifically to provide for the protection of electronic tax systems, to prohibit cyber tax crimes and to include a representative of the FIRS as a member of the Cybercrimes Advisory Council. Furthermore, the Ministries of Justice at the Federal and State levels should create cybercrime departments for the prosecution of cybercrime. Finally, the FIRS should create a cybercrime monitoring unit that will be charged with the responsibility to regularly interface with all relevant cybercrime prevention agencies. The FIRS should ensure that members of the unit are trained and exposed to relevant cybercrime prevention and management skills.
References
- Newman U. Richards, LLB (Benin), BL (Nig.) LLM (Awka), PhD (Awka), ACIArb (UK), ACTI, Lecturer in Law, University of Nigeria. Tel: +234 8033865411. Email at: [email protected] or [email protected].
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