ABSTRACT
The aim of this study was to investigate on taxation and its effects in the Nigeria economy. One of the objective carried out by the researcher was to examine peoples perception on taxation. Taxation is seen as a tool aimed at improving the performance of the national economy by such means as altering the balance between current consumption and capital investment. It looked at the work of other authors in order to make the exercise richer. Their different views were seen in different books and other materials (journal) which made this study much better than similar works in this area. In carrying out this study, the researcher used both primary and secondary data. Questionnaires and interviews were used in generating the primary data while the secondary data were obtained through library researcher and other sources. The purposive sample of 147 respondents were randomly selected for the study to avoid numerous errors in the calculation. From the data collected and analysed, it was evident that tax collection plays a great role in the development of the Nigeria economy. Conclusively, discussion, summary, conclusion, and recommendations were made to achieve the purpose of this work.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Taxation is the system of raising money in form of taxes paid by the citizens of the country in return for the services rendered by the government. It could be recalled that taxation is instituted by God, this is traced back to “Mattew chapter 22 vs. 17-21”, when the Pharisees asked Jesus whether it is lawful to pay taxes or not. The Pharisees were later told render therefore to Caesars the things that are Caesar’s and to God the things that are to God.
According to Lekan .S. etal (2006), tax was described and not defined in the statues, but according to Cambridge international dictionary of English, it is “an amount of money paid to the government usually a percentage (%) of personal income or company profits”.
According to Okpe I.I (2000) tax is the transfer of resources and income from the private sector to the public sector in order to achieve some of the nation’s economic and social goals.
Taxation is universally accepted as a powerful tool in the hands of any government to raise income for its services and to ensure equitable distribution of income among its citizens.
Therefore, in every modern communities, a large amount of taxation is necessary for a public expenditure increases to promote social progress, taxation which is the main sources of funds also increases.
The present tax laws in Nigeria emanated from the Raismais commission in 1957. Before this time we only had what was called the income tax ordinance for the colonies and which was rather common in all the colonies and the provisions were very similar. Raim’s recommendation was the basis of provision in the Nigerian constitution order council of 1960 section 70(1) which conferred an exclusive power upon the parliament to make laws for Nigeria or any part thereof with certain uniform principles in respect of personnel income tax.
During 1963 when Nigeria became a republic, the mid-western region was created out of the western region and they adopted the western region tax law accordingly with the amendments,