CHAPTER ONE

• INTRODUCTION

Several attempts have been made to offer a comprehensive definition of tax or what taxation really means this individual have come up with different definition of tax, which have the same meaning.

According to the encycolopedia Britannia it said, tax is the compulsory levy that is designate for a special purpose. It is regarded as a contribution to the general revenue pool from which most government expenditure are financed.

David W. Peurce in the Macmillan dictionary of modern economic gave this definition also, tax is the transfer of resources from the private to the public sector in order to accomplish some of the nation economic and social goals.

It is a compulsory levy by the government of the country through an approval agent usually the Federal Board of Inland Revenue (FBIR) against the income or wealth of partnership, company or individuals.

1.1    BACKGROUND OF THE STUDY

Taxes are the most important source of the government revenue and the major means of financing government activities for the benefit of the citizen of different countries. Tax play a relative minor role in the ancient word for instance, consumption wee levied on Greece and Rome.

These not worth tax were confirmed to real property but they were later extended to other element of net worth. Taxes are used as a means of raising additional fund. In time of war, taxes of net worth are usually temporarily imposed. Real estate transactions were also taxed.

In Greece, free citizen had different tax obligation from slaves and in Rome the tax law differs between national and residents of conquered territories.

Taxation come unto existence at different data at various part of the world. In Nigeria it was in 1904, in the early days government impose tax on raise revenue only to cover the cost of administration and defense such as the maintenance of low and other home, takes are no longer imposed merely to cover unavoidable cost of service provided by the state.

• STATEMENT OF THE PROBLEM

This research work is based on the appraisal of Nigeria taxation, its aim objective and contribution to the economy. There are many problems militating against the aims and objectives of tax there by hindering its positive contribution to the economy.

However, the following problem will be examined in this research so as to appraise the Nigeria taxation system.

• Lack of information on the research for tax
• There are no enough qualified staff for the tax collection to carry out the tax drive in order to generate revenue
• Many limited liability company’s are difficu1lt if not impossible to be assessed because of improper books of accounts
• Mismanagement of government find by those at the corridors of power kills the enthusiasm of the citizens to fulfill their circle responsibility of paying tax,
• Inadequate provision of social amenities for which tax revenue is supposed to be means for.
  • OBJECTIVES OF THE STUDY

The objectives of Nigeria taxation try to point out what the Nigeria tax system stands to achieve. The principal objective is to raise revenue to finance government expenditure. This is still the primary objectives, but since 1940, government has also used different level of taxation as an important way of influencing the activities of economy as a whole.

Tax policy provides a mechanism for customers demand for providing incentive for production, investment and savings.

It is thus, a way factor of promoting the government over all economics and social objective for objective.

For example, taxation is used nowadays to achieve economic growth to fight depression, inflation and deflation to achieve equitable distribution of income and wealth of the nation. Also to allocate revenue in socially desirable manner, to discourage the consumption of certain within the country and to ensure that the balances of payment of the country is in a healthy position.

• SCOPE AND LIMITATION OF THE STUDY

The focus of this research project is to cover the Federal Board of Inland Revenue (FBIR) Ilorin area office and will be limited to it. There is the problem of non availability of adequate and reliable information and statistical data for the study.

Some of the official and staff of Federal Board of Inland Revenue claimed that they had no time to answer questions while some hide under the pretext of not wanting to release official document.

Also the unwillingness to allow me have access to some of their records the stamp duty and capital gain collection were not available.

Another major element is limitation of the time constraints and finance which are also vital elements in any research project inspite of the above the researcher have endeavoured to provide a good research work.  

• SIGNIFICANCE OF THE STUDY

The study is important to the general public and government, it will educate people more about the importance of taxation to the economy i.e. since 60% of government revenue is from the resource available in the country while the remaining percentage is from taxation for development and provision of infrastructure and as such government should encourage people to pay their taxes accordingly.

It will contribute to one’s knowledge as to the problem faced in collecting taxes and possible ways out of such shorts comings.