Taxation and Local Government in Nigeria
Chapter One
OBJECTIVE OF THE STUDY
The main objective of this study is to ascertain the efficacy of taxation and local government administration in Nigeria; but to aid the completion of the study, the researcher intends to achieve the following specific objective;
- To ascertain the problem of revenue generation in Nigeria’s local government administration
- To examine the role of local government administration in the tax collection process and implementation of tax policies
- To examine the relationship between local government administration and revenue generation
- To examine the impact of local government administration and rural development in Nigeria
CHAPTER TWO
REVIEW OF RELATED LITERATURE
Introduction
The chapter is devoted to the review of related literature. It is expected that in the course of this review the concept of taxation would be defined and explained with special interest on the personal income tax administration in Nigeria. According to Chartered Institute of Taxation of Nigeria Tax guide and Statutes, Nigerian tax law is purely statutory, the tax system thus features a wide mixed range of statutes by which various governments in the country seek to charge and collect revenue for public expenditure. Of these, the most widely based are income taxation. The personal income tax act makes provision for the country, adding that liability to personal income tax in Nigeria does not depend on the domicile or nationality of the tax payer (Abdulrazaq, 2002:4)
DEVELOPMENT OF LOCAL GOVERNMENT IN NIGERIA
The evolution of local government in Nigeria has under gone a lot of changes. These are all geared towards making the local government a system that could serve the purposes for which they are created, before the emergence of the British Colonial/ Administration; various communities in Nigeria were governed through the instrumentality of their traditional political Institutions. These institutions were anchored on the people’s habits of thought, prestige and custom which are adapted to meet the new conditions for general development of their areas.
Local authorities were empowered to charge and collect developmental rates based on a certain percentage of the income of the rate payers. The council enjoyed the social autonomy of providing certain social services to the community, for instance the local government was vested with the responsibility of healthcare services delivery with the transfer of primary healthcare delivery system.
In the 1950s, election was introduced according to the British model in the western and eastern parts of the country with some measure of autonomy in financial, general administration and in personnel which gave rise to tide of progress, growth and development experienced in the local government.
Prior to this period, the British introduced native courts chaired by Chiefs, native treasuries where taxes collected from people were paid in for use by the local government. Native authorities were created with traditional rulers at the head of each authority. The traditional rulers continued to dominate local government’s administration until the military took over power. In 1966, from then the powers of the traditional rulers, especially in the northern region, reduced gradually. The newly created states in the Northern region increased popular participation in local government administration. Larger local authorities were broken to smaller ones and native authorities were changed to local governments.
The local government reform of 1976 provided the guidelines for local governments in Nigeria. The reform created large-sized local government areas throughout the federation based on a certain minimum population requirements, these results in uniform local government areas. The federal government for the first time was involved in the funding of local governments. The local government gets statutory percentages share of Federation accounts and state revenue. The local government was made a third tier of government, which means the local government has its own powers. There were about 301 local government councils as at 1976.
In 1986, the Babangida Administration made local government an effective third tier of federal system, introduced reforms aimed at enhancing their autonomy and strengthening their administrative framework. All elected councilors now constitute legislative arm of the local government which the executive arm consists of the chairman and vice-chairman and supervisory councils. The local government witnessed several reforms between 1991 to 1992. The reforms snows a fundamental implications for local government administration, especially in regard to the reforms to the local government service. 589 local government areas were in existence as of 1991 local government reforms and there was establishment of the executive chairmanship of local government with functions firmly entrenched in schedule four of the constitution.
CHAPTER THREE
RESEARCH METHODOLOGY
Research design
The researcher used descriptive research survey design in building up this project work the choice of this research design was considered appropriate because of its advantages of identifying attributes of a large population from a group of individuals. The design was suitable for the study as the study sought examine the efficacy of taxation and local government in Nigeria.
Sources of data collection
Data were collected from two main sources namely:
(i)Primary source and
(ii)Secondary source
Primary source:
These are materials of statistical investigation which were collected by the research for a particular purpose. They can be obtained through a survey, observation questionnaire or as experiment, the researcher has adopted the questionnaire method for this study.
Secondary source:
These are data from textbook Journal handset etc. they arise as byproducts of the same other purposes. Example administration, various other unpublished works and write ups were also used.
Population of the study
Population of a study is a group of persons or aggregate items, things the researcher is interested in getting information on the study taxation and local government in Nigeria. 200 staff of selected local government was random selected by the researcher as population of the study.
CHAPTER FOUR
PRESENTATION ANALYSIS INTERPRETATION OF DATA
Introduction
Efforts will be made at this stage to present, analyze and interpret the data collected during the field survey. This presentation will be based on the responses from the completed questionnaires. The result of this exercise will be summarized in tabular forms for easy references and analysis. It will also show answers to questions relating to the research questions for this research study. The researcher employed simple percentage in the analysis.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
Introduction
It is important to ascertain that the objective of this study was to ascertain the efficacy of taxation and local government in Nigeria.
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 challenge of tax administration and local government in Nigeria.
Summary
Nigeria’s tax system is characterized by unnecessarily complex, distortionary and largely inequitable taxation laws ii that have limited application in the informal sector that dominates the economy. Among the other problems relating to taxation can be added the low yield of revenue disregard for the true principle of federation, endemic institutional and management concerns at sub-national levels, weak tax assessment, corrupt processes, and the prevalence of multiplicity of taxes. The major challenges facing tax authorities include the need not only to build, but also to utilize institutional and human capacity, funding and logistics as well as finding solutions for tax evasion, fraud and mismanagement of collected revenue, improving voluntary compliance and quick adjudication on legal matters for the tax system to be efficient and effective it must produce officials that are well-paid,-well-motivated, properly organized, adequately equipped, well-disciplined and professionally-inclined. The system needs to adhere to simple, clear and unambiguous tax laws, assessment and collection procedures must be straightforward, transparent, client friendly
Conclusion
This study identified and examined various sources of revenue generation as well as the problems of revenue generation in Nigeria. The study revealed that local government in Nigeria are confronted with several problems which include corruption on the part of revenue collectors, lack of bye-laws on revenue tariff, farming out of revenue base on political patronage and so on. It has become obvious that Corruption is the major issue in the developmental study of the local government councils in Nigeria. It is therefore believed that the local governments could do better in internally generated revenue if council officials honestly and aggressively do their job. But more often, these officials are involved in corrupt practices by short changing the council either by printing their own personal receipt booklets or misappropriate council funds. The fact that such culprits are not decisively dealt with accordance with extant rules and regulations have encourage other to be the same line of corruption, resulting in the ever more dwindling internal revenue profile of the council.
Recommendations
The following recommendations are proffered for the amelioration of the problems of revenue generation in local government administration in Nigeria:
- Revenue collectors should be checked on regular basis by the Internal Auditor of the council in consonance with the provisions of financial regulation and any one found guilty of corrupt practices should be punished accordingly.
- The use of council staff should be encouraged. Enough staff should therefore be employed by the council to man the various revenue units of local government.
- Adequate legislation on revenue tariff is very necessary. Therefore, the council should ensure that its legislative body makes an up-to-date tariff to forestall instances of use of discretion by revenue collectors.
- Revenue Agents should be abrogated and replaced with local governments employed staff.
Reference
- Aibieyi, Stan (2011). Local Administration and Local Government in Developed and Developing Counties. Ibadan: Amfitop Niggled.
- Edoyugbo, J.E (2012). The Problems of Revenue Generation in the Local Government Administration: A Case Study of Oredo Local Govt. Council, Benin City, Edo State; Unpublished Masters in Public Administration Project, Department of Political Science and Public Administration, University of Benin, Benin City.
- Egonmwan, P. (1984). Principles and Practice of Local Government in Nigeria. Benin City: S.M.O. Aka & Brothers Press.
- Gunman, J. A. (1984). Principle and Practice of Local government in Nigeria. Benin City: S. M.O. Aka and Brother Press,
- Ibhawaegbele, F.O. (2012). Rural Transformation: A Matter of Lip Service. In The Catholic Evangelist ’s (ed) Vol. 18 No. 140 p.6 Benin City: Floreat System Press
- Obadan, M.I. (2008). Inauguration of Chairman of Esan South Local Government Area, Benin Paper presented at the Inauguration of Newly Elected Local Government Chairmen in Edo State, Benin City
- Ojofaitimi, Tunde (1998). Problem Confronting Revenue Generation and Proper Monitoring of Field Officials in the Local Government Councils: A paper Presented at the Seminar for Secretaries and Treasurers of Local Governments at Nike Lake Hotel, Enugu.
