EVALUATION OF THE IMPACT OF TAXATION ON TRANSFORMATION AGENDA

EVALUATION OF THE IMPACT OF TAXATION ON TRANSFORMATION AGENDA

(A CASE STUDY OF BOARD OF INTERNAL REVENUE, LOKOJA KOGI STATE)

ABSTRACT

The project work is centred on the evaluation of the taxation on transformation agenda. Using a case study of board of internal revenue Lokoja, Kogi State. The major objective is to find out the effect on the individual, (i.e. tax papers) the companies and government of Kogi Stae. The evaluation of the impact of taxation on transformation agenda, is positively in Nigeria’s tax growth. It was however recommended that for transformation agenda to be meaningful, government must address the enormous challenges it face in the areas of multiplicity of project in the face of dwindling resources and the need to articulate a cohesive programmes that is well focused and implementable so as to address the challenges of taxation on transformation agenda.

CHAPTER ONE

1.1 INTRODUCTION

The study of taxation is part of the study of public finance which is concerned with revenue and expenditure of government. How they are received and distributed and the effects of those operation in the economy. Taxation is a relation on subject that branch off from financial accounting. The meaning and purpose have been defined by known authorities on the subject.

Tax is a peculiar burden laid down upon individual or property to support government. It is a payment exacted by legislative authority. It is a civic duty, it is not a voluntary payment or donation but an enforced contribution imposed by government whether under the name of tools tribute, duty customs, exercise subsidiary and levies and rates etc government in this case can be federal inland revenue, state board of internal revenue, local government and any other agency of the government.

Tax generally is a compulsory levy on both the human and material resources of a nation usually collected by the government to meet its financial obligation. It is a compulsory levy imposed on the income or wealth of an individual, partnership or a corporate body resident in a country.

The present day administration is guided other following income tax management act (CITA) (1979) refers to the 1979 which regulates the taxation of registered company realizing fund or revenue for the state achieving social and economic objectives.

1.2 BACKGROUND OF THE STUDY

Transformation implies a complete change a break from old way of doing things. The challenges is whether tax transformation implying that those who control state tax represent the interest of the majority of Nigeria, a change that will define how social force in the country relate to production. Many and sometime great are the policy pronouncements strategies and programmes meant to transform the Nigerian economy over the years. For example, the structural adjustment programme, SAP implemented in 1986 was to transform the tax and put it on a path of non inflationary, sustainable growth. At some point, SAP virtually destroyed the tax and intensified the development of underdevelopment in Nigeria.

The tax practitioners must be aware of social responsibilities in areas such as environmental protection, equal opportunity and occupational safety. Since world war II society has held the business world increasingly responsible for meeting certain non economic standard. In 1970 social responsibility of business is merely to increase profit. But the prevailing sentiment today is that business and the professions should return something to society to make it better, not just to make a profit for the tax practitioners, this could mean going beyond the minimum legal responsibility to provide equal opportunity in the hiring of employee by making special recruitment efforts or it could mean volunteering time to help charitable organization with their tax problems.

1.3 STATEMENT OF THE PROBLEM

Tax is a pecuniary burden laid down upon individuals on property to support government. Despite the income generated from tax to support governments to produce social amenities, such as good roads, hospitals electricity etc. There are other tremendous problems.

One of such problems can be traceable to the effect on the price and output of commodities which form part of the production cost. This often result to higher prices.

Apart from the aforementioned problem, there exist a legal loopholes in tax avoidance thereby reducing the tax payer liability.

In fact, tax evasion as also become as major problem in Nigeria today. Tax payers penetrate by seeking to reduce his tax liability through illegal means.

It should be very paramount regarding these challenges, hence the need for the study.

1.4 PURPOSE OF THE STUDY

The purpose of the research work is to find out primarily the effect of taxation on the individuals company’s and the government of Kogi State. Tax polices are got simply monetary they are psychological affecting emotions, the reasons and the economic behaviour of the tax payer and the community it can stimulate the economy and also generate revenue to Kogi State government based on the research findings possible recommendations and suggestions will be offered to the government of the day to enhance their revenue. Also possible ways of making the self employed to pay a commensurate tax according to their income will be suggested.

– To achieve economic growth and development in the country.

– To achieve price stability in the country

– To encourage and protect new infant industries within the country

– To ensure that the country’s balance of payments is in a favourable position through the manipulation of import duties and export duties, tax can be used to correct adjust a balance of payment deficits.

– It is to serve as a source of revenue to assist government in financing its expenditures.

– It is to influence economic activities

1.5 RESEARCH HYPOTHESIS

Hypothesis is an intelligent or educated guess concerning some variable.

It is also tentative statement that expresses the relationship between the two or more variables.

We must know that there are two types of hypothesis and alternative or non directional hypothesis. Null hypothesis is denoted by Ho which mean it does not give direction of change while alternative hypothesis is denoted by Hi is the opposite of null hypothesis.

Ho: The tax revenue cannot contribute to national development

Hi: The tax revenue can contribute to national development

Ho: Skimming and penetration cannot be used for taxation

Hi: Skimming and penetration can be used for taxation.

1.6 SIGNIFICANCE OF THE STUDY

The study will be of great benefit to the tax payers and the public on the area of transformation agenda.

– It will show the types of tax been use on transformation agenda.

– It will allow the reader to update his knowledge about tax procedures.

– The study will give room for evaluation of efficiency and effectiveness of the personnel present in he performance of their tax duties and measure it against laid down tax standard.

– This study will afford the tax payers to evaluate the .essence of tax.

1.7 THE SCOPE OF THE STUDY

Any social research necessity allows broad coverage it is important to delimit the work to enhance in depth analysis for this reason, the researcher is concerned mainly about the impact of taxation on transformation agenda with reference to the economy of Kogi State, therefore, in this investigation we are mainly concerned with the state board of internal revenue (SBIR) and the state office of statistics in Kogi State.

1.8 LIMITATIONS OF THE STUDY

In the course of understanding this work, the researcher was faced with some many problems first was the problem of non cooperation from most officials of the board because of the sensitive nature some of the personal interviewed were not cooperating. Another problem encountered was the difficulty in getting access to official documents and up to date records because of the fact that the state government is trying to restructure operational system of the board.

Time was another great constraint. Any social research is hindered and this is more of such research which is outside experimental studies limitation, that readily comes to mind is the area of data collection, cost and analysis the main instrument for the research work is the ‘’questionnaire’’ and no matter how it is developed, it is subject to the bias of individual respondents.

CHAPTER TWO

2.1 LITERATURE REVIEW

In this section, the issue of tax on transformation agenda as a major responsibility in the successful conduct of the various activities of organization.

Tax administration in the last two decades has been the concern of many researchers on taxation and public finance in Nigeria. Their conclusion was that the case of evaluation of the impact of taxation on transformation agenda shows clearly the efficiency and effectiveness of the authority concerned.

Taxation as an instrument of social and economic development has been quite popular among federal, state and local government most states and local governments have adopted the device of modern tax administrative techniques on tax revenue generation as a major instrument of accelerating development in the field of social and welfare services.