Aug 09, 2016 taxation in nigeria and history of taxation in nigeria a tax in nigeria is a compulsory levy imposed by the federal government of nigeria on individuals and corporate entities in respective of return of service expected from the government. Taxation and tax policy as government strategy tools for. The study group was inaugurated on 6th august, 2002 to examine the tax system. Summary of tax costs in nigeria, by state 5 world banks doing business survey revealed. Azubike1 michael okpara university of agriculture umudike umuahia abia state nigeria. Tax legislation is the act or process of enacting tax laws and the body of laws that provide for the levying of taxes and tax administration. The policy will now be endorsed by the national economic council to recognize the federal system of government given the application of the policy to all tiers of government. The policy will now be endorsed by the national economic council to recognize the federal system of government given the application of the policy to all tiers of. The federal competition and consumer protection act 2019. The general objective of this study is to determine the effect of tax morale on the taxpayer in compliance with tax policies of government in nigeria.
Multiple tax practices and taxpayers noncompliance attitude. Conceptual background tax revenue mobilization as a source for financing development activities in nigeria has been a. He is an author and public speaker on tax, business and economic matters. Similarly, objectives and guiding principle, driving institution of nigerian tax system, administration and policy and concept of utin where also discuss. Furthermore, the paper provide brief but precise knowledge of nigerian tax system, tax policy and underpinning tax law of the country. A nigerian newspaper and online version of the vanguard, a daily publication in nigeria covering nigeria news, niger delta, general national news, politics, business, energy, sports, entertainment. Value added tax and economic development in nigeria. It is aimed at creating a tax system that will contribute to the wellbeing of all nigerians and taxes which are collected by. Multiple taxes, taxpayers, attitude, nigeria, efficient, effective 1.
Fiscalmonetary policy and economic growth in nigeria. Whether the new policy is a new dawn or another false start, time will tell. Economic and fiscal implications of nigerias rebased gdp. However, the use of tax as an instrument of fiscal, policy cannot be possible except effective and efficient government tax planning and administrative machinery is ensured in the country. Merger control 2020 laws and regulations nigeria iclg. Making up about 97% of the entire economy, they serve as a source of employment generation, innovation, competition, economic dynamism which ultimately lead to. Federal ministry of finance affirmation and acknowledgement of the importance and contribution of all stakeholders in the administration of taxes in nigeria. Rights under policies of insurance, other than life assurance policies. Multiple tax practices and taxpayers noncompliance.
The countrys tax system is lopsided, and dominated by oil revenue. National tax policy guidelines and rules vanguard news. Nigerian value added tax system and the concept of basic food article pdf available in ssrn electronic journal january 2016 with 7,568 reads how we measure reads. The purpose is to further enhance the process of tax collection and administration in nigeria. Mar 19, 2019 the federal competition and consumer protection act 2019. An overview of national tax policy and administration in nigeria. Based on the findings of this study, it was suggested that a reconciliation of two enactments thus the cama and cita to a policy of charging tax on profit rather than charging on turnover be given immediate attention.
Pdf taxation and tax policy as government strategy tools for. Essentially, the bill amends several portions of the nigerian tax laws. This paper attempts to examine the relationship between value added tax and economic development. Anyamu 1997 writing on tax policy planning and administration in nigeria opines that a tax system that ignores the tax planning and administrative aspect. No leakages arising from insufficient information and tax compliance requirements. Making up about 97% of the entire economy, they serve as a source of employment generation, innovation, competition, economic dynamism which ultimately lead to poverty alleviation and national growth. Nigerias president muhammadu buhari signed the finance bill 2019 pdf. Tax is a medium which countries across the globe depend upon so as to carry out the mandate of their citizens. Such policy includes the introduction of the taxpayers identification number tin, which became effective since february 2008. National tax policy chartered institute of taxation of nigeria.
The implementation of fiscal policy is essentially routed through governments budget. Elimination of double taxation by addressing provisions that make double taxation a fait accompli in our tax system. Nigerias national tax policy any agenda for the new firs chair. The national tax policy seeks to provide a set of guidelines, rules and modus operandi that would regulate nigerias tax system and provide a basis for tax legislation and tax administration in nigeria. Impact of nigerian tax policies on the economy and small businesses in nigeria abstract small and medium enterprises play a very important role in development of the nigerian economy. Apr 20, 2017 nigeria has a new national tax policy the federal executive council, the highest executive decision making organ in nigeria just approved a new national tax policy for the country. Section 4 examines the effects of fiscal measures on the economy in. The policy is designed to achieve the following specific. The tax policy enumerates the monetary charges imposed by government on individuals, companies, transactions or properties for the purpose of revenue. Administration of current taxes in nigeria vanguard news. It is also characterized by unnecessarily complex, distortionary and largely inequitable taxation laws that have limited application in the.
How the finance act seeks to address the taxrevenue gap. The company income tax act in the law that regulates the taxation of all limited liability company doing business in nigeria private and pubic limited companies alike, other than those engaged petroleum operations, the federal board of inland revenue is the sole authority for the administration of this tax. The national tax policy seeks to provide a set of guidelines, rules and modus operand. Navigating the risky nigerian transfer pricing regime in 2020.
National tax policy in nigeria federal ministry of finance. Visit our tax blog to download a copy of the revised national tax policy. Evaluate the effect of tax revenue on infant mortality im in nigeria. The following are the existing tax legislation in nigeria, as at 2016. Combining equations 1 to 6 produces the equation below which is our. According to the presidential committee on national tax policy 2008, the central objective of the nigerian tax system is to contribute to the.
This study a nalyses the impact of non oil tax revenue on economic growth from 1993 to 2012 in nigeria. Policy objectives the national tax policy provides the fundamental guidelines for the orderly development of the nigeria tax system. An overview of national tax policy and administration in. This led to the federal inland revenue services establishment act 2007 thereinafter referred as the act 2 on tax administration at the state level in nigeria.
The national tax policy should be the bible that guides the thinking, formulation and execution of strategies relevant to taking tax administration at all levels assessment, collection etc and the tax system at large to optimum heights. The value added tax act vata or the law, 2007 governs the administration of vat in nigeria. The nigerian tax system has been taken through several reforms and modifications. The tax revenue collection in nigeria faces some formidable problems which includes the high tax rates and complex filing procedures, multiple taxation and lack of proper enlightenment, lack of statistical data, poor tax administration, and inability to prioritize tax effort, multiplicity of taxes and increase in underground economy. All of these are expected to work together in order to achieve the economic goal of the nation. Pdf nigeria is governed by a federal system, hence its fiscal operations also. The federal executive council, the highest executive decision making organ in nigeria, yesterday approved a new national tax policy for the country. Most of the laws in the compendium are contained in the various volumes of the laws of the federation of nigeria. Activities of nonnigerian companies, which would attract tax in nigeria and other special issues, are spelt out in the laws. Identify the effect of tax revenue on labour force lf in nigeria. The tax policy enumerates the monetary charges imposed by government on individuals, companies, transactions or properties for the purpose of revenue generation. The ntp is a document which sets broad parameters for taxation and ancillary matters connected with taxation in nigeria. Under companies income tax act you have to pay companies income tax if you are a resident or nonresident company incorporated in nigeria. Nigeria pkf assurance, audit, tax, advisory and business.
Iclg merger control laws and regulations nigeria covers common issues in merger control laws and regulations including relevant authorities and legislation, notification and its impact on the transaction timetable, remedies, appeals and enforcement and substantive assessment in 55 jurisdictions. Section 4 examines the effects of fiscal measures on the economy in the country. Taxation in nigeria plus history of taxation in nigeria. Nigerias tax regime is unnecessarily cumbersome and notoriously unfriendly to taxpayers.
The foregoing had been the situation until towards the end of the last regime when the country embarked on a world bank inspired economic reform agenda. Research hypotheses the following hypotheses are formulated for this study and are stated in null form. Value added tax and economic development in nigeria madugba, joseph ugochukwu1 joseph,u. Nigeria is governed by a federal system, hence its fiscal operations also adhere to the same principle, a fact which has serious implications on how the tax system is managed. Development of any tax policy on tax revenue for economic development should better be based on human development index rather than gdp. The government is also seeking for a way to incur minimal cost in the process of enforcing tax on nigerias. This study examines the determinants of tax administration efficiency. Vat is levied at each stage of the production chain at 5% of the value of the taxable good or service.
However, izedonmi 2010 noted that multiple tax practices became more pronounced and prevalent in the late 1980s, which. Taxation in nigeria and history of taxation in nigeria a tax in nigeria is a compulsory levy imposed by the federal government of nigeria on individuals and corporate entities in respective of return of service expected from the government. Pdf on jan 1, 20, oyewo babajide and others published taxation and. The national tax policy is an initiative of the federal government of nigeria which is being driven by the federal ministry of finance on the basis of the report from a study group in july 2003. Regulatory implications for merger transactions in nigeria. The nigerian tax system is lopsided, and dominated by oil revenue. The national tax policy is an initiative of the federal government of nigeria which is being. Commencement rules under section 293 of cita will not apply to. The tax system in nigeria is made up of the tax policy, the tax laws and the tax administration. Naturally, the adoption of the ntp in 2012 raised the following key questions around nigerias tax system given that there are existing tax legislation in operation within the polity. Oct 06, 2017 such policy includes the introduction of the taxpayers identification number tin, which became effective since february 2008. Ascertain the effect of tax revenue on gross fixed capital formation gfcf in nigeria. Nigeria could be joining the number of countries introducing digital taxes. The national tax policy is a document that provides all the necessary information relating to taxation.
Tax implication of mergers and acquisitions vanguard news. In the report, paying taxes 2014 the latest iteration of an annual study by the world bank and pwc that compares the ease of paying taxes globally nigeria ranks 170 out of 189 economies. In nigeria, nobody can dispute the fact that though this taxes are been collected, they are. This study provides a useful insight for the government, stakeholders and policy makers into the importance of tax revenue. Impact of tax administration on government revenue in a. A revised national tax policy ntp was approved by the federal executive council on february 1, 2017. Examples are turnkey projects, allocation of income and expenditure between the foreign company and its branch in nigeria, transfer pricing etc.
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