Impact Of Taxation On National Development
Impact Of Taxation On National Development
Every government in carrying out its fiscal responsibilities provides the individual within its area of jurisdiction the basic necessities of life. To place an order for the Complete Project Material, pay N5,000 to Then text the name of the Project topic, email address and your names to 08060565721.
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Then text the name of the Project topic, email address and your names to 08060565721.Such necessities of life include rural and urban electrification construction of roads and bridges, provision of pipe-borne water, building and maintenance of schools, establishments of hospitals, payment of wages or salaries of civil servants etc. the responsibilities of every government is quite enormous, and Delta State is not an exception. How then does the government generate fund to provide the basic amenities or necessities? The government can only do this by generating enough revenue to finance these projects. The government being a non-profit making organization needs to generate revenue from taxes and other sources.
Taxes are the major source of government revenue for funding its activities such as finance its budgets and development plans. Tax can therefore be defined as a compulsory levy or contribution but not penal to the government based on incomes, goods and services of individuals, companies and unincorporated bodies etc. for the common benefit of the public. Or in the other way it can be said to be the transfer of resources from the private to the public sectors in order to accomplish the nation’s economic and social responsibilities. It is the main fiscal tool for activities macro-economic objectives.
Tax revenue is used in increasing the rate of economic growth and hence the per-capital income, leading to higher standard of living. Tax is not only the source of government revenue. Other source include: Fines and fees, Licenses, reimbursement, miscellaneous state share of federal government revenue, loans and grants quota contribute a large proportion of the total internally generated revenue. These show that the level of government expenditure should go to a great extent depend on the ability of the tax system to phase the required revenue at the disposal of the government.
In recent times, consideration and attention have been focused on the fiscal policies best suited to the economic development of the country. As part of this search for desirable fiscal policies, consideration is being placed on the role of tax policies.
Recently the federal government has introduced the Value Added Tax (VAT) No, 102 of 1993. It is a consumption tax with the exception of drugs and baby food act, and the incidence is on the final consumer. It collected at each stage of the production and distribution chain. The rate is 5%. All money collected from VAT goes to the federal government while they share out the funds to the three tries of the government in the ratio prevailing at the particular time. The current ratio (1998) is 25% to federal, 45% to state and 30% to local governments. Tax revenue can rise or fall due to some factors which include the following: exogenous charges in the bases to which taxes applies, changes in the substance of the tax laws, and finally, enhances in the quality and efficiently of tax administration.
The first factor is illustrated by the rise or full in the tax revenue from personal income tax as the economy of country booms to depress. The second factors, is typified by the many changes in tax laws, whereby revenue is increased through raising the tax rate applied or is lost through the exemption from taxes.
The third factor is very hard to illustrate convincingly. For instance could a highly publicized campaign educate the people of the need for them to pay their taxes increase tax revenue immediate or only after sometimes when the government actually extents some. Projects that convince the people that there is what is best suited to the people as far as tax policies are concerned must be identified. In Nigeria, the major source of government revenue include personal income tax, company income tax, petroleum profit tax, company income tax, petroleum profit tax, capital gain tax, capital transfer tax, import duties, etc. However, this research study is limited to the taxes under the administration is concerned because it is when we have good tax administration that enough tax revenue is generated.
The revenue will also be compared with other revenue sources available to the state. Suggestions will be made on ways of improving tax administration in the state, hence tax revenue generation.
BACKGROUND OF THE STUDY
The purpose of this research under review is an attempt to evaluate the efficiency and effectiveness of tax as an instrument of revenue generation in Delta State and development. It may be recalled that Delta state is on of the carved out state of the former Bendel State, the former mid-western region. It is also understood that it ordinance first applied to Benin-city the then capital of Bendel state.
In Nigeria today, there are many forms of taxation. The administration and payment of tax taxable adults in Nigeria dates back to pre-colonial era. Then both the administration and collection of tax were carried out by the Emirs, Chiefs, and their appointed agents. The system as it was, through highly functional for that time was extremely evoked and arbitrary. It is important to note that tax collection developed from the Northern state of the country and gradually percolated to the southern states. On the advert of the British about 1900, the administration of tax was affected through several amending ordinates (now Acts or Decree) which principally entrusted the responsibilities of collection of taxes on local authorities.
However, the first form of taxation in Nigeria is income tax which was introduced for the first time in the northern parts of Nigeria in 1904 by Lord Lugard. It was known then as community tax. He later made changes which culminated in the native revenue ordinances of 1917. An amending ordinance that extended the provision of 1917 ordinance to southern Nigeria was passed in 1918.
The first ordinance was applied to Abeokwuta in Ogun state and to Benin-city in Bendel state, and it was only extended to eastern Nigeria in 1928 due to the strong resentment to the imposition in that part of the country.
However, what can be regarded as the modern from of income taxation in this country came into existence in 1940 under taxation ordinance No. 4 of 1940 and then subsequent income tax ordinance No. 29 of 1943.
In 1943, by an ordinance personal income tax, in the modern and progressive form could said to have been introduced in Nigeria, even though the administration and collection of tax was still share between the British and the local authorities. When Nigeria became a federation in 1952 the regional governments (Northern region; western Region, Eastern and the federal capital Territory of Lagos) took full responsibilities for assessment and collection of taxes thus each of the regions including the federal territory of Lagos made their respective tax laws to give effect to assessment and collection of personal income tax. However, the relief and rates of tax still varies from one region to another in the right of the sudden development of tax culture of consciousness among the regions, the possibility of inter-region of tax payers were apparent. In order to avert this situation and introduce reasonable measure of uniformity and sanity in tax administration of the country the income tax management Act, 1961 which embedded most of the recommendations of management Act 1961 failed to unify rates of taxes, relief’s and allowances throughout the country.
To complete the Act former western state enacted its own law the income tax law of 1957, by re-enacting the provisions of the 1961 Act. The western Nigerian law of 1957 deals with principles mentioned in the 1961 Act. Bendel state has not enacted any income tax ordinance of her own but has instead adopted western state income tax law no. 16 of 1957 as amended. It is from this law that Bendel state adopted that formed the basic tax states upon which the present day tax laws of Delta state where made. A state can thus legislate on income tax, a subject which the federal government has also legislated. The 1957 law fails however to say that incomes not itemized shall be subjected to tax law. It remains however subject to Income Tax Management Act (I.T.M.A.) 1961, which has nation-wide application with the Joint Tax Board (J.T.B.) as supervisory authority.
The defects in I.T.M.A. 1961 were ratified by Income Tax Management (Uniform Taxation Provisions) Act 1975. Subsequent amendments took place before the enactment of the personal income tax decree no. 104 of 1993 which has been amended to date.
STATEMENT OF THE PROBLEM
It is the duty of the government of any country to provide its citizens with those basic amenities that will make life enjoyable to them. This is because individual cannot single handedly provided amenities to themselves. The provision of these basic amenities can only be possible through taxation.
Tax from time immemorial has been a powerful agent or instrument for revenue generation considering the efficiency of taxation of tax is the major problem that obstructs the maximum collection of taxes from individuals and groups. Through it could also be accepted that improper revenue collection methods and shortage of manpower and facilities hinder the efficiency of the taxation system. The in deprives the government tax Due thereby drastically reduced revenue generated from taxes, due to these there be adverse effect as the amount available for the provision of necessary social and economic activities are also reduced and finally results in governments inability to provide the citizens with the basic necessities of life.
Ikechukwu I. Okpe said that it is undoubtedly understood that the consequent approach to be taken by the government as a result of inefficiency of tax is the search for alternative means of raising revenue. Moreover, in a country like ours, where the internally generated revenue is low with tax being the predominant will look for an alternative for the external source of revenue, like borrowing from abroad in order to meet up with the necessary social and economic activities. This will undoubtedly press the nation into more serious problem as she has been accredited and a debtor nation whose debts are really growing without corresponding repayment.
These problems provides in a situation where there is inefficient taxation system. The study is centred on presenting these problems and therefore finds out whether there is any relationship between the inefficiency of tax and national development.
OBJECTIVES OF THE STUDY
The Main purpose of the study is to determine the impact of taxation on national development.
Specifically the study seeks to:
(a) Identified the type of taxes paid by the people of Delta state.
(b) Find out the use of taxes in the provision of social services (education, health, etc) in Delta State.
(c) Find out the use of taxes in the development of infrastructural facilities (roads, housing, transportation etc) in Delta state.
(d) Find out the use of taxes in the payment of public debts, bank loan etc.
THE SIGNIFICANT OF THE STUDY
This study was important because when its findings would be implemented many people, organizations, etc would see the reason why they are asked to pay tax and also know what they are for. It will also enable persons who are interested and a group or the governments have in debt knowledge to smooth operation of the matters and its consequent effects on the optimal revenue operation of the matters and its consequent effect on the optimal revenue collection in Delta state.
The research will be of immeasurable aid to the future researchers and one who is normally interested in tax matters and when all the corrective steps and recommended reformations are adhered to will improve the efficiency of taxation system and therefore attainment of the necessary social and economic activities will be enhanced.
To find answers to the problems of the study the following research questions have been formulated.
1. What are the types of taxes paid in Delta state?
2. How are taxes used in the provision of social services in Delta state?
3. How are taxes used in the provision of infrastructural facilities in Delta state?
4. How are taxes used in the payment of public debts in Delta state?
FORMULATION OF THE HYPOTHESIS
H(1) There is a significant relationship between tax revenue and total revenue generation of the states
H(0) There is no significant relationship between tax revenue and total revenue generation of the state.
H(1) The tax administration system of Delta state is not very
The descriptive research was used in this study. Description research describes, interprets the situation and seeks to discover the condition and relationship that exist, opinion need, presses going in and trends that are developing.
LIMITATIONS AND DELIMITATIONS OF THE STUDY
This work has been restricted to sources of revenues through which Delta state is empowered by the laws to generate revenue vis-à-vis taxes. Therefore, the study will ultimately deal with only those various types of taxes that are within the jurisdiction of Delta state government.
With respect to this, the research is deemed to cover the operations of the board of internal revenue Delta state, the daunted problems hampering the effective operations of the board and also the root cause of tax evasion and avoidance in the state will be examined. The impact of all these on revenue generation are treated with particular reference to the followings:
1. Reasons why tax payers evade or avoid tax.
2. How tax avoidance and evasion is carried out.
3. the contribution of tax officials in evading tax
4. The problem of tax administration machinery.
5. The extent of tax revenue generated.
The findings and recommendations have been considered in the light of the limitations of the study particularly its sample size and average. The survey was only limited to some selected areas of Delta state. The data collected from this areas have been used a parameter for the other areas not covered by the survey.
Also only selected taxable adults in Civil Service, outside the civil service and those who are privately employed were used as the major variables in the study to deal with the cause of tax evasion.
However, it is difficult for one project to successfully obtain and manage numerous variable that is supposed to observed where human being are involved because of the limitations which have one way or the other tried to hamper a more in-depth work on this study. These limitations are time and financial constraints.
DEFINITION OF TERMS
The tax acts did not specifically define the word “Tax”. Over time, great men and leaders have expressed their understanding of what Tax is.
Franklin D. Roosevelt once defines Tax as dues we pay for the privilege of membership in an organized society. To Albert Einstein, income tax is the hardest thing in the would to understand. While Ralph Waldo Emerson believes that for every benefit you receive a tax is levied.
According to Mr. D. A. Olumukeke of Business Times of may 27th 1985. The director of the federal board of inland revenue, in his article titled “taxation in Nigeria: Prospects for reforms” defined Taxation as “The process or machinery by which communities or group of persons are made to contribute part of their income in some agreed quantum and method for the purpose of the administration and development of the society.
This is why it is often referred to as a civil obligation.
Tax therefore is a compulsory contribution but not penal to the government based on incomes, goods and services of individuals, companies and unincorporated bodies etc for the common benefits of the public.
Tax generally is not payment for services rendered nor is it a consideration for services about to be rendered.
According to Oxford Advanced Learner’s Dictionary, “Revenue is income especially the total annual income of a state or an organization, government department which collect money for public fund”.
TAXABLE INCOME DEFINED:
Taxable income is income subject to tax by any government authority.
Taxable profit is the amount of profit as computed under the provisions of a particular tax law or revenue act upon which an income tax is levied.
In government and institutional accounting, a fund is a sum of money and often other assets constituting a separate accounting entity, created and maintained for a particular purpose and having transactions. It’s double entry accounts are self balancing, and from them a balance sheet and operating statement may be prepared for cash fund.
REVIEW OF RELATED LITERATURE
Literature review addressed the following:
(a) Concept of Taxation.
(b) Types of taxes paid by individuals, groups or companies.
(c) Uses of taxes in the provision of social services.
(d) Uses of taxes in the provision of infrastructural facilities.
(e) Uses of taxes in the payment of debts, loan etc
CONCEPT OF TAXATION
There are many definitions of Taxation. The Government engage in a number of activities which requires the expenditure of funds. In order for Government to be able to undertake most of these activities, it raises funds through taxation. Buhari (1982) defines taxation as compulsory contribution from individuals and business organization for the purpose of financing Government programmes.
Prof Okeke (1986) said in his public sector Accounting and Finance that taxes are the most important source of Government income. Prof. (Okeke 1982 defined Taxation as a compulsory contribution imposed by a public authority irrespective of the exact amount of service rendered to the tax payer in return. This definition points towards three characteristics of Taxation:
(i) It is a compulsory contribution imposed by the Government on the people residing in the country. Since it is a compulsory payment a person who refuse to pay a tax is liable to punishment.
(ii) A tax is a payment made by the tax payer which is used by the government for the benefit of the citizens. The state uses the revenue collected from taxes for providing hospitals, schools, public utility services, etc which benefit all people.
(iii) A tax is not levied in return for any specific service rendered by the Government to the tax payer An individual cannot ask for any benefit from the state in return for the tax paid to him. The tax payer cannot claim something equivalent to tax paid from the Government.
According to Winfery (1979) tax is regarded as compulsory change imposed by the public authority (federal, state and local government) for the general pool which most Government expenditures are financed.
Okonkwo (1995) defined tax as non-punitive but yet a compulsory levy on properties and income of individual and corporate bodies. Okpe (1998), the ultimate aim of taxation is to raise high standard of living for the citizenry.
However, tax can even be defined as 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. Some of the economic and social goals may be in the form of provision of additional government basis services particularly in education, public health, transportation, capital formation and in the provision of facilities.
TYPES OF TAX
Taxes are generally classified into both direct and indirect tax.
This is tax levied or imposed directly on individual, companies or corporations in other word, direct taxes are levied on income and properties of those who pay them and bear the burden directly. Examples are personal income tax, company income tax, petroleum profit tax, capital Gain tax, Withholding tax or rent, contract and supply professional fees, Director’s fees.
This is a tax levied on goods, and services rendered which are shifted in part or in full to the final consumer who does not even know either when he pays or the exact amount he pays. Examples of indirect taxes are, entertainment tax, import Duties, Export Duties, Value Added- Tax (VAT) etc.
TAX ADMINISTRATION IN NIGERIA
Okpe (1999) reveals that tax administration is guided by the following Acts and Decrees.
(i) Personal income Tax Decree (1993) referred to as Decree 104 of 1993.This governs the taxation of individual trustees, executors, partnership, communities and families.
(ii) Company Income Tax Act (CITA) 1979 referred to as the 1979 Act which regulates the taxation of registered companies.
(iii) Petroleum profit Tax Act (PPTA) 1959 as amended upto 1995 referred to as PPTA 1959 as amended. This Act regulates the government and collection of petroleum profits. Tax payable by organizations that engage in the extraction and sales of petroleum products in Nigeria.
(iv) Capital gain tax Decree (CGTD) 1969 which was introduced by Decree 44 of 1967.This Decree takes care of gains accruing to any person on or after 1st April, 1967 on the disposal of chargeable assets.
(v) Value Added Tax (VAT) Decree 102 of 1993 which imposes tax on some selected goods and services manufactured in or imported into the country. The repeated sales tax in the country.
(vi) Education Tax Decree No 104 0f 1993.
Tax Authorities in Nigeria
The main bodies recognized by law as Tax authorities in Nigeria are:
(a) Federal Board of inland Revenue (FBIR)
(b) State Board of Internal Revenue (SBIR)
(c) The Joint Tax Board (JTB).
Federal Board of Inland Revenue FBIR (1998)
The federal board of Inland Revenue, as the name implied is under federal government and is responsible for tax on the following:
(i) Companies, irrespective of where they are located.
(ii) Non- residents: Companies and individuals.
(iii) Officers of the ministry of External Affair and Nigerian foreign service.
(iv) Persons resident outside Nigeria who are shareholders of Nigerian companies.
(v) Persons in receipts of Nigerian persons where such pensions are payable overseas, and persons employed in the Nigeria Army, the Nigerian Navy and the Nigerian Air force including those employed in civilian capacities, (Decree No. 51 of 1972).
(vi) Individual resident in Abuja and the federal capital Territory.
Functions of the Federal Board of Inland Revenue (FBIR).
(i) To assess, collect and account for taxes assessed and collected throughout Nigeria.
(ii) To deal with claims, objections and appeals of companies income tax payers.
(iii) To impose penalties on defaulters of company income tax law.
(iv) The board has the power to delegate any person to act on it’s behalf in carrying out its duties, thus the board may authorize the joint Tax board to execute its duties provided by a notice in a writing.
(v) To see the administration and collection of VAT in Nigeria.
State Board of Internal Revenue (SBIR) (1998) Membership
The state Board comprises:
(i) The Executive Head of service is the chairman.
(ii) The Directors and Head of Departments within the state service.
(iii) A Director from the state ministry of Finance.
(iv) A legal adviser to the state service
(v) Three other persons nominated by the commissioner for finance in the state in their personal merits and
(vi) The secretary of the state service who shall be an ex-officio member.
Powers and Duties of state Board of Internal Revenue.
There main duty is to assess, collect and account for taxes so collected. There assessments are on individuals and persons. For the attainment of the above duties, they also carry out the following functions:
(i) Authorize the communication of information regarding tax.
(ii) Appointment of Agents
(iii) Confirmation of offence that may arise from time to time.
(iv) Appointment of a person or board of persons to assess the total income of tax payers.
(v) Variation of assessment, estimates and computations.
(vi) Directing of tax payers to keep books of accounts.
(vii) Imposition of penalties where necessary and appropriate.
(viii) Make refunds where necessary eg assuming somebody has been over taxed.
The Joint Tax Board (JTB) (1998)
This is the apex and policy making board in Nigerian Tax system. It is responsible for the administration of income tax in Nigeria as provided by income tax management Act of 1961.
According to the Act the membership of joint tax board is as follows:
(i) The chairman of the federal Board of Inland Revenue as its chairman.
(ii) An officer or a representative of each of the states of the federation, normally the Head of the board of Internal Revenue of each state.
(iii) The federal civil service commission shall appoint an officer to the Board.
(iv) The Legal Adviser to FBIR who shall be in attendance to advice on Legal matters.
Powers and Duties of Joint Tax Board (Okpe 1998)
(i) To exercise the powers and duties conferred on it by the express provisions of the PITD 1993, and any other powers and duties, arising under the act which may be agreed to by the Government of each state to be exercising by the Board.
(ii) To advice the federal Government in respect of any proposed amendment to personal income Tax and other laws.
(iii) To promote uniformity both in application of tax law and incidence of tax on individuals throughout Nigeria.
(iv) To exercise any power and duties conferred on it by an enactment of the federal Government imposing tax on the income or profits of companies.
(v) To advice the federal Government, on requrest, inrespect of double taxation arrangement with any other country and in respect of rates of capital allowances and other taxation matters making any effect through out Nigeria.
(vi) To settle Accomplaints or conferred on it by the Governments of the states.
Uses of Taxes
Buhari(1982) said that many people often wonder why they have to pay tax at all and the fact that a part of their legitimate earnings has to be surrendered to government is not taken lightly in the least.
In spite of the emotional factors surrounding the issue of taxation, nevertheless, some valid arguments have been put forward to justify government imposition of taxes in any country.
a. The Revenue to cover Expenditure Argument
One of the most powerful argument in support of taxation is its use as revenue sources to cover Government expenditure. The provision of service and infrastructural facilities in a country cost money. Many of those goods and services are public good whose provision cannot be restricted. The argument for taxation is that fund so obtained could be used in providing such public goods for every body to enjoy, buhari (1982)
b. The Stabilization Argument
Taxes may also be used for the purpose of stabilization. Two aspects are easily discernible and these are:
(i) The use of tax to reduce inflation
(ii) The use of tax to stimulate economic growth Buhari (1982).
(i) The use of Tax to Reduce inflation
If any country is experiencing inflation, one way to deal with the situation is to raise direct taxes on individual income as well as on business profits. In the case of the former, the tax would reduce disposable income which, inurn, would lead to overall reduction in the demand for consumption goods. In the case of the increased tax would lower investment by business, consequently, the overall reduction in the demand for goods and services (consumption goods and investment goods) would, all other things being equal, lower prices. Buhari(1982)
(iii) The use of tax to stimulate Economic Growth
When an economy is experiencing depression, the overall level of taxes may be lowered in the economy. The resulting lower taxes may increase disposable incomes as well as business profits. This, inurn, may stimulate the demand for more consumption goods by individuals as well as more investment goods by businesses. The multiplier effect of the resulting changes, may increase income output and employment, Buhari (1982).
C. The Regulation Argument
In a micro- economic context taxes may be used as a means of influencing consumption and production patterns, which is to regulate the consumption and production of certain goods in the country. Suppose the government wishes to discourage the consumption of certain type of imported goods, it may impose higher import duties on them, since the price of such imported goods are likely to rise as a result of the higher taxes, domestic demand for them may be reduced, this however, depends on whether such imported goods are elastic or inelastic in demand. Also, in the case of production pattern, the government, in order to encourage the production of certain goods in the economy, may lower exercise taxes on them, which it may raise the exercise taxes on other goods whose production it wishes to discourage. Okonkwo (1995).
d. Income Distribution Argument
Okonkwo (1995), argument have also been made to justify the imposition of taxes on income distribution grounds. On this platform, it is argue that existing pattern of income and wealth distribution in an economy without tax, may aggravate the disponity in standard of living between the rich and the poor. By levying taxes in a progressive manner, the gap is some what reduced and this may be the prime reason of levying taxes in some cases.
Types of taxes paid by individuals groups or companies.
The types of taxes that are paid by individuals, groups or companies are of two types, namely:
(a) Direct tax
(b) Indirect taxes
Okpe 1998, this is a very broad terms are those taxes levied directly on individuals and business firms.
Buhari (1982), indirect taxes are taxes levied on goods, and services. It is those taxes that can be shifted from one person to another, i.e. from one tax payer to another knowing or unknowingly. Nigerian direct taxes include:
(i) Personal income tax
(ii) Company tax
(iii) Petroleum profit income tax
1. Capital gain tax
(iv) Capital transfer tax etc
I. Personal income Tax
Buhari said that in many developed countries, personal income tax accounts for a substantial portion of government revenue in Nigeria and many West African countries, the proportion of revenue that comes from personal income tax (except perhaps in recent years as relatively low. The reasons for these situations are that too many transfer earnings occur as a result of the extended family system and a substantial number of eligible tax payers evade tax because of poor monitoring system.
ii. Company Tax
Winfere (1979), said compulsory Tax (sometimes called corporate tax) is levied on the profits of business organizations. Company tax is relatively easier to collect in Nigeria as a result of government’s insistence on the submission of tax certificates in respect of any official obligation from government by companies. These tend to encourage compliance.
iii. Capital Gains Tax
A capital gain tax as the name implies, is a tax resulting from the sale of capital assets, Okeke (1986). If an individual who buy a landed property for say #50,000 result it for say, #120,000 the difference of #70,000 which is the gain is subject to capital gains tax in many countries.
iv. Petroleum Profit Tax
Okonkwo (1995), this is a special type of tax which was introduced in Nigeria in 1959. This tax has become an importance source of government revenue because of the special position which petroleum occupied in the economy. Only oil producing companies or companies engage in oil exploration business are expected to pay this tax.
v. Capital transfer Tax
Okonkwo (1995), when a person dies, government usually imposes a tax on his estate, if any? before the estate could be taken over by relatives or those eligible. In some cases, such taxes may even be paid when the transfer is made prior to the death of the person transferring the property.
Okpe (1993), indirect tax is one which is imposed on goods and services, it is of two different types. It could be specific, in which ases, a fixed amount is levied on a commodity. It could also be “ad-valorem” when the tax imposed is a percentage of the cost of the commodity.
Buhari (1988) also stated that there are different types of direct and indirect taxes. The main form of indirect taxes are;
(i) Import duties tariffs
Udere (1989), import duties, sometimes called tariffs, are taxes levied on goods imported into the country. An import duties has the effect of increasing the prices of such commodities in the importing county. Where imported are elastic in demand, import duties on them tend to shift demand on locally produced goods as a result of their prices (imported goods).
ii. Exercise Duties
Exercise duties are taxes imposed on specific goods produced in a county. Cigarettes and alcoholic drinks are popular targets for exercise taxes because of their low elasticity of demand.
iii. Export Duties
The third form of indirect taxes is that levied on goods produced for exports such a tax is called an export duty. It tends to raise the price of such export goods making them relatively in competitive in the consuming country. This, there is a dilemma in which the tax yields revenue for the government but may leads to loss of foreign exchange earnings as a result of reduction in demand following the lighter price which the tax leads to.
Uses of Tax in the provision of social services
Okpe (1997) described taxes as one of the major sources of revenue for all governments in Nigeria. The taxes paid comes back to the tax payer as a form of social amenities. Nigerian tax is assessments imposed by the federal and state government to enable them provide services for Nigeria citizens.
Rabni (1981) also added that single handedly that the citizens cannot provide all the basic amenities which are the social services that enhances their living standard; they contribute a fractional part of the huge amount used in the provision of these basic amenities through the payment of taxes and government provide the remaining part. Without the imposition of tax on individuals, on companies, it would be difficult for government to provide the social services needed. The ways by which taxes are used in the provision of social services according to Okpe (1997) are:
1. In the Educational sector
Government uses part of the revenue from tax collected in the payment of the teaching staffs and non-teaching staffs especially in secondary schools and some tertiary institutions.
2. In the Area of Health
In this Area, taxes collected are used by the government in the payment of salaries to the doctors who work in the government hospitals, nurses and other categories of staffs that are found in the hospital.
3. Agricultural sector
This sector is very important to the economy of every government therefore, needs to be protected for continual existence and growth. Agriculture produces e.g. cocoa, latex, forms part of the countries export which brings about economic development. Government uses the revenue from taxes to encourage people into going into farming instead of all rushing for white colar jobs that will be of benefit to the country by payment of salaries with the revenue from taxes to those who work in the agricultural sector. If the Extension workers whose duty to go about advising people even those in the rural area on the importance of going into farming and how to go about it.
4. Manufacturing sector
Government also uses part of the taxes collected in the payment of salaries to those who work in her companies.
The defence of any country or nation is a very important matter that will be of great concern to the government of that country. When the defence of any country is loose, there is every tendency that the stability of the government will be treaten so the government provides strong and reliable groups for defence to protect the government and the life of the people. These groups are encouraged by paying them salaries and these salaries are provided by the government with the revenue from taxes paid.
7. Poverty Alleviation
The bulk of the capital that is used by the government for poverty alleviation programmes comes from the money collected as tax from individuals, groups and companies. Taxes are also used in the payment of salaries to workers.
Uses of Taxes in the provision of infrastructural services:
Okpe (2001) said that infrastructural facilities are those basic amenities that are tangible that can be seen, the construction of roads is an example of infrastructural facilities which helps in enhancing the living standard of people.
Tabansi (1980) stated that imposition of taxes on individuals in Delta state is for the development of infrastructural facilities. Taxes are used in the provision of infrastructural facilities in the following areas:
1. Government uses parts of the money or revenue from taxes in the erecting of building or establishment of schools, and in the development of the existing ones. School blocks, offices, provision of facilities in the schools such as chalk, chairs and desks, black boards, etc are all provided by the government with part of taxes paid.
2. Building of Hospitals
Governments uses part of tax paid by the citizens in the building of hospitals and providing hospitals equipment that will be benefit to the same citizens who are the tax payers.
3. In the area of Agriculture- government uses part of that in the provision of taxes, offices for Agricultural workers, irrigation are provided to facilitate the development of Agricultural scheme. Agricultural materials such as fertilizers are also provided by the government with part of tax payment to share the rural dwellers at subsidized rates.
4. Taxes are also used as an in actives to help the manufacturers, e.g. giving them tax holidays for the products they have manufactured for two three years and a maximum of three years. The government uses taxes to encourage the manufacturers by reducing the rate of tax, e.g. the current rate of tax is 30% but government gives incentives to the manufacturers especially medium and small scale industries. Presently their current rate of tax is 20%. The act encourage them to embark on manufacturing instead of buying and selling.
5. In the area of transportation government uses part of the tax payment in the construction of roads, bridges, provides mass transit, Delta state workers mass transit which carries workers to their place of work free of charge.
6. Part of tax payment are used by the government in the provision of ammunitions for defence for the armies, police and force workers. Construction of barracks and also provision of uniforms.
7. In the area of Defence government uses part of tax payment in the construction of boarders this prevents people from neighbouring countries from entering with out the permission of the government.
Uses of taxes in the payment of Public Debts and loans.
Public Debt: Nweze (1998), atimes the term public debt is misunderstood for deficit. A deficit, or more appropriately a budget deficit is the difference between a particular year’s total government receipts and the same years total government expenditure.
The national or public debts on the other hand, is the accumulated total of past deficits less past surpluses. Public debt may be categorized as to whether it is internal or external. In the case of internal public debt, payment of interest or repayment of principal involves simply a transfer from tax payers to security holders. Thus, to the extent that the debtor (i.e. taxyers) is worse off, the creditors ( i.e. security holder) is better of in other words, no increase in the size of the debt can make the county as a whole either poorer or richer. External debt on the other hand, are debts owed by a country to institutions or countries abroad. To the extent that interest payments are made abroad and principal repaid, there are implications for the countries balance of payment.
In 1982, Nigeria’s external debt amounted to about $13 billion. The debt services ratio was nearly 11 percent, while her debt export ratio was 100 percent.
By 1990, the county’s external debt had amounted to about $33 billion, the debt service ratio rose to 30 percent while debt export ratio was about 400 percent. He went further to state that some government of many countries borrow when it is discovered that they cannot finance their projects this leads to accrued debt which is public debt.
The revenue from tax are gradually used to ofsit the debt. Buhari (1997), there are number of caused which has led Nigerian and other developing countries into the debt crisis now facing them and these factors includes:
i. Huge Budget Deficits
One major causes of Nigeria’s public debt especially, the internal debt, is the persistent deficits which various governments have incurred in their budgets over the years. Since one way to finance such deficit was contributed to the growth of the debt stock over time.
ii. Heavy dependence on oil revenues
Another major causes of the debt crisis was the false illusion of riches which oil revenue gave the country in the seventies. This made the government to continual spending and embark on heavy capital intensive projects on the assumption that oil would continue to bring in huge revenues when oil prices despites the increase could not make any difference in the 1980’s and oil revenue subsequently fell, government resorted to borrowing to finance her project.
iii. Short-Term Loans Being used in Financing Long-Term projects.
Another major causes of the debt and it’s growth was that in some cases, short-term funds were borrowed to finance long-term projects. Thus, when such loans mature, the returns from the project were not able to provide sufficient resources to pay the debts thus worsening the debt crisis.
iv. Reckless contraction of loans
In some cases, loans were contracted without regard to viability of projects they were meant to finance. Corruption, political factors and personal gains of government officials who negotiated such contracts seemed to be the major factors in contracting certain loans rather than the soundness of the projects to be financed with the loans.
v. Rise in interest Rates on commercial loans
Some loans were granted to Nigerians by commercial banks in Western countries, whose interest on loans very with the dictates of the markets. Thus, with the upward trends in interest rates in recent years, Nigeria’s debt obligation mounted.
vi. Poor performance of non- oil export
Neglect of the Non- oil sector, particularly, the Nigerian’s debt crisis. With the misfortunes of the oil sector, had the Non- oil sector compensated for the consequent short fail in revenue projects, the county would not have contracted the kind of loans sue resorted to. This poor performance was compounded by the poor terms of trade which developing countries tend to suffer in the world market.
vii. Structural imbalance in the economy
There are experts who believe that Nigerian’s huge debt burden and its growth may have been as a result of structural imbalance and the need to undertake economic adjustment.
Such experts explain that the debt crisis is inevitable due to the resource gap between the rich northern hemisphere and the poor southern hemisphere of the world.
Uses of Taxes in the payment of Debts and loans.
Nwoha (1998) stated that for every government to survive it has to borrow from any available source to finance its projects. This is because these projects requires a lot of money which are not available atimes. Government he said uses the part of taxes collected to repay the loans. He said that government uses some of the taxes collected in the repayment of loans borrowed from private individuals.
Taxes are also used in the repayment of the loans borrowed by the government of a country from another country over which have been incurred already over a period of time.
Taxes are also used in repayment of loans borrowed from international banks, agricultural development banks, world bank, commercial bank, credit and commerce banks.
Taxes are used in setting loans from federal, state and local government.
Summary of Literature review
In the study and attempt was made to find out the impact of taxation in the development of Delta state.
Taxation was perceived as the transfer o resources and income from the private sector to the public sector in order to achieve some of the nations economic and social goals.
Some of the economic and social goals is seen to be in the form of provision of additional government basic services, particularly in education, public health, transportation, capital formation and in the provision of facilities.
Taxes are required as one of the major sources of government revenue. The taxes paid come back to the taxpayer inform of social services such as development of education, health services, Agricultural food production. External and internal defence of the nation and poverty alleviation programme.
The imposition of taxes on individuals in Delta state is seen to be for the development of infrastructural facilities such as, roads, and bridges development , Housing development, Agricultural equipment, industrial development, Electricity supply for urban and rural areas, pipe-born water supply.
The use of taxes in any country cannot be misunderstood. The tax paid are collected and pat of it are used by the government in settling of public debt.
Infact, the uses of tax in any state or county cannot be under rated.
STATE SHARE OF FEDERAL REVENUE
Is the analysis of data contained in table 4.3 it can be seen that state share of federal revenue contained #533,753,342, in 1996 the contribution was #759,678,000 while in 1997 and 1998 it contributed #736,711,260 and #1,019,418,860 respectively. These represented 52.74% of the total revenue for 1995 and 69.26% of the total revenue for 1996, while for 1997 and 1998 it formed 53% and 53.63 respectively of the total revenue. This revenue sources has therefore been consistently the highest contributor in the total revenue of Delta state in the years under review.
Table 4.13 illustrates the internally generated revenue in Delta state for the fiscal year 1995-1998. It is also illustrated the graph attached. In the analysis each tax revenue source will be compared with total revenue for the period to see how much the source has contributed to the total internally generated revenue in the state.
PAY AS YOU EARN (PAYE)
Pay as you earn system which can also be called PAY-AS-YOU-PAID in not on itself a separate tax, but a scheme whereby income tax on wages and salaries of employees in the relevant tax year are collected by deduction at source by the employers of labour on behalf of the state. Members of the Nigerians Army, Air force, Navy and officer of Nigerian Police and external Affairs are not under the PAYE system.
It is the duty of the employer to deduct tax from the pay pocket of his employer whether or not he has been directed to do so. PAYE is usually deducted on a monthly basis from January 1st to December 31st every year.
This scheme is a very important revenue source because it contributed more than other tax sources as can be seen from table 4.13 and figure 4.2 in 1995, it contributed 18.96% and 1996, 1997 and 1998 it contributed 26.03%, 38.22% and 28.85% respectively. The bulk of the tax revenue generated through this scheme is usually from employees of government ministries and other civil servants.
The parts collected by private individuals are not totally turned over the state Board of internal Revenue. This means that amore efficient tax administration machinery should be set up to improve tax revenue collection method.
DIRECT ASSESSMENT TAX
Unlike the PAYE system, this form of tax is collected from all categories of self employed persons, such as traders, businessman, partnerships, etc. This group of tax payers is required to submit in the relevant years of assessment their income for the year on which they are assessed and taxed. The income sometimes is subject to certain deductions and allowances before the actual chargeable income is a direct assessment tax for example contributed 7.88% in 1995, 8.91% and 26% in 1996 and 1997 respectively, while it contributed 15.98% in 1998.
The assessment of personal income tax is usually made difficult by the lack of voluntary compliance by the payers people do not show up voluntarily until events or circumstances force them to do so. Gross understatement of income and refusal to render returns also contribute to reasons why so much revenue is lost. Most Nigerians and dishonest and so refuse to declare their actual income. If better administrative machinery is set in motion, the direct tax assessment will generate even more than Pay-As-You-Earn (PAYE) scheme
This has been replaced by the value Added tax since 1994. From the task 4.14 in 1995 the sales tax contributed 42.04% of total tax revenue generated. In 1996, 1997 and 1998 if contributed 45.57%, 8.48% and 8.54% respectively.
With-holding tax deducted at the source of income. The type of income chargeable to withholding tax includes rent, dividends, interest and employment income.
Employment income has been treated under PAYE. These incomes are subject to certain percentages of tax and the net income is given to the income earner. In 1995, with-holding tax made a contribution of 28.04% to the total tax revenue for the state. 1996, 1997 and 1998 respectively, it contributed about 16.10%, 17.88% and 23.13%. The importance of this type of tax cannot be overemphasized. If this tax is well managed, it is bound to yield much more them it is yielding now.
PENALTIES AND ENTERTAINMENT TAX
We could understand that so much is spent on entertainment by our people. But entertainment generated during the period under review. In 1995 penalties and entertainment tax contributed 0.022 percent of the total tax revenue, according to 4.14. In 1996, 1997 and 1998 its contributions were only 0.02%, 0.013% and 0.020% respectively, of the total tax revenue of the fiscal year under review.
A more efficient and better tax administrative system and policy needed to improve money collected from entertainment in the state, if a better tax policy is developed, mush can be realized from entertainment tax because the people love entertainment are very much involved in it.
Mortuary tax contribution to the total tax revenue for the period is very meager. It contributed 0.05% in 1995, 0.03% in 1996 while in 1997 and 1998 it contributed 0.01 and 0.04 percentage respectively to the total tax revenue, according to table 4.5. The poor contribution is not that the people do not make use of mortuaries but it is due to poor administrative machinery of tax which have failed to make adequate use of available opportunities. A lot of people use the mortuaries these days but probably most of these who make use of the facilities do not pay mortuary tax, some times, because nobody asked them to pay. Even when the taxis paid, the operators of the mortuary services do not turn the money realized over to the tax authorities.
OTHER TAX REVENUE SOURCES
Education levy and development levy are flat rate levies on taxable adults and business. They are for development purposes. Delta state needs a lot of infrastructure and they introduced a number of levies to make this possible. According to table 4.5 development levy contributed 2.99% in 1995, 3.34% in 1996, 5.73 in 1997 and 9.15 in 1998, etc. education levy and other can be seen from the table.
If a well articulated tax administration is put in place the tax revenue in the state will be greatly improved with the new introductions.
THE PROBLEM OF TAX ADMINISTRATION IN DELTA STATE
From the analysis of the data collected from Delta state Board of internal Revenue and ministry of finance and Economic planning, it has been found out that tax contribute about 50.88% of the total internally generated revenue (see table 4.4) and 11.66 of the total revenue that is relevant to he state (see table 4.3).
This calls for improvement in the tax administration of the state if more taxes to improve government funding.
The major problem area on taxation generation in Delta state is personal income tax on self employed persons. There are a lot of potentials in the use of income tax as a revenue source for economic development and as a fiscal tool. But the obstacle to this is that it is relatively difficult to administer.
In Delta state the amount of tax revenue of people in employment overwhelms that of self employed persons. Because tax liabilities of employees are deducted at source, there is no way they can evade tax hence much is realized from the PAYE scheme. This shows that the problem borders on tax administration. If the state government wants to expand revenue generated from income tax, more attention should be paid to assessment of self employed persons.
In Delta state many self-employed persons do not pay tax. On the other hand, those who pay, do not pay amount commensurate with their incomes. This is only because the present tax assessment and collection process are defective and inefficient. This can be conformed by official government warnings about people evading taxes. Sometimes government directs that people should present their tax certificates before transacting any business with government institutions. For instance, when one is looking for government contract, the person is first of all asked to present this tax clearance or receipt. This is because voluntary compliance which is the corner stone of effective tax administration is lacking in our society.
The problem of mal-administration of taxes in Delta state is also reflected in the fact that the state Board of Internal revenue has inefficient trained tax personnel. No matter how efficient a tax system is, its success will depend to a large extent on the availability of trained personnel to execute the tax policies and collect the liabilities assesses. Although the Board has been encouraging its staff by giving them study leave with pay, very few staff of the Board possesses adequate qualification. Even those who are University graduates are not professionals. It is possible to find some one who studied history or society being placed at the head of assessment or adult section or even in charge of statistical unit.
Another problem is lack of correct statistical data. Because the board is staffed with unqualified personnel, record keeping is difficult. Some times, records got from sub-sections are misplaced because some of the staff does not appreciate why they should endeavour to keep correct records. All these problem culminate into administrative inefficiency and lack of good internal control system. There is lack of infrastructural amenities; there are no vehicles for tax officials to use in performance of their duties. At times there are no stationary for record keeping.
Sharp practices and mismanagement of tax revenue are common problem. Tax collectors often collaborate with tax payers to cheat the government. Sometimes the tax collectors take bribe from the people and help them to evade tax.
SUMMARY OF FINDINGS, CONCLUSIONS AND REMMENDATIONS.
The previous chapters have attempted to provide an overview of this research topic. Relevant literatures relating to the topic have also been presented. This chapter will attempt to summarize the result of the findings in the course of the research and present suggestions, recommendations and conclusions.
SUMMARRY OF FINDINGS
Generally, it was established that there is s general consensus that civil servants pay more tax than self employed Ola (1976: 471). He noted that under the pay as you earn (PAYE) system, it is difficult for civil servants to evade tax. He also noted that with direct assessment of taxation where the self-employed is given the opportunity to summit his annual account the tax payer can exploit the situation to see that his burden is reduced. He can do this by understating his income.
In supporting this argument, Agyei (1979:64) stated that civil servants because of (PAYE), Schemes have little or no way of evading tax, white self employed can always understate their income.
The researcher was able to find out that:
1. A high proportion of self-employed problems did not pay personal income tax. It was discovered that only 44% of taxable adults in the state paid their tax regularly, of which the majority were employees. A break down of the figure shows that Agbor has 30% while Umunede has 28% as obtained from the respondents.
Tax evasion is one problem yet to be addressed in the state many changeable persons evade taxes because the policies are not strong enough to treat them to it. The rich minority pay little or no tax. Tax is only collected from them when they need some government benefits like contracts, lead acquisition or registration of land of school children because they are required to present tax clearance certificates. Evidence show that many of them do not pay adequate tax commiserate to their tax incomes as they always falsity their profits.
There is difficulty in ensuring accuracy and completeness of moral roll (i.e. population) of those chargeable. Most people in the state have poor attitude to tax payment. Voluntary compliance is lacking among taxable adults. Dishonesty among tax officials contributes cost to the problem of tax evasion.
Moreover, many business transactions in the country are not documented. About 71% of the respondents do not keep accurate record and accounts of their transactions. Illiteracy is found to be a contributing factor to this lack of record keeping. But a majority of the tax officials interviewed that it is deliberate in order to evade tax.
The state experiences a big loss of tax revenue on the area of assessment. A great majority of tax payers escape full liability either through under-decelerations of income or under assessment by the authorities.
a. Traders declare themselves to presents farmers in order to be assessed on the minimum income.
b. Traders rarely keep accounts of their transactions and where they do the accounts are invariably not declared to the tax authority for assessment.
c. There is the general belief among the illiterates taxable adults that only persons holding salary positions and those earning wages should pay tax. Adequate enlightenment is not given to the public on the need for payment of tax, and on how the tax revenue is utilized. The provisions of the tax laws are not communicated to the public. As a matter of fact, some people do not even know that tax evasion is as crime.
It is an acceptable principle of a good tax system that the cost of administration must be small and that compliance must be small and that compliance must be enforced. Voluntary compliance must been lacking. Most people refuse to pay unless they are forced. This result is high cost of tax administration thereby defiantly the aim of a good tax system.
Majority of personnel employed in administration of both state and local government are untrained, inefficient and dishonest.
This low revenue realised from personal income tax, when compared with the estimated population is tax payers of not less than 1 million is due to a portion of this population refusing to pay tax.
Sales tax which is very important state revenue is only on insignificant portion of tax revenue. However, this has been replaced with value Added Tax (VAT) which has proved to be a realistic economic policy.
The state share of the federal government revenue constitute the bilk of the total revenue in each of the periods under review, accounting for over. 50% of the total revenue. This means that tax revenue is not the major source of government funding in the tax.
Tax ranks third in the total revenue sources of the federal government generates revenue mainly from crude Oil. It is from this that it gives the state of share of the revenue. This means that of the oil well dries up, most activities in the state will grind to a halt. Something must be done to stop this heavy dependence of the state on federal budget. Other sources of revenue should be seriously exploited tax revenue can improve if a good tax administration machinery is set in motion in the state.
Finally given the existing revenue based and the tax policies in operation the problem of raising more fund for Delta state lies not in formulating new tax policies but in improving on the administration must be attended to if tax revenue generation is to be increased.
For the state to attain its objective of increasing tax revenue the following suggestions are made.
Arousing social conscience against tax evasion.
Tax evasion and tax avoidance reduce the tax revenue generation. In order to increase tax revenue generation, the state should seek the support and co-operation of the peoples. This will be made possible by using public enlightment programmes which will appeal to the conscience of the payers. High tax rates should not be employed because it can complete evasion.
The law against tax evasion should be made strident so that any one who evades taxes should face the law and be seventy punished time public should also need to be convinced that tax evasion is anti social.
The earlier argument is that tax management is concerned with measures designed to conduct evasion. Avoidance, unlike evasion is legal proportion attention should be paid to measures designed to minimize the incidence of avoidance which is growing at an alarming rate. To this end, the following action should be taken.
A legislation should be made in the state making it mandatory for every person up to the age of 21 years living in the state to register himself and his occupation. This will enable the tax authority to keep a record of taxable adults in the state. Moreover, nobody will fell cheated.
The whole of section 20(a) of the income tax management act(ITMA) and table 2 of 30% to 25% there is an indication that it is still high and leads to tax evasion and avoidance on a large scale. Maximum rate of 10% on earned income is sufficient, rates on all income. Levels could be out without revenue loss.
Tax education should be introduced in our primary and secondary schools in social studies, the media, television, radio and national duties, should be used effectively for educating the public against tax evasion. For example, a documentary showing how a heavy burden on a hones tax payer by injecting unhealthy and harmful trend in the states economy, should be shown always.
In order to gain the confidence of tax payers, it is important that the operators of the state funds should be seen to be speeding the available resources judiciously, and not misappropriating them.
RE-OGANISATION OF REVENUE DEPARTMENTS
The quality of tax administration is reflected in the caliber of manpower responsible for carrying out the duties. The following adjustments are suggested.
i. Adequate staffing of the state Board of internal revenue is very essential. The staff should also be paid adequately to avoid labour turnover on fraud.
ii. Proper training cannot be over-employed. Businessmen are very clever and so much to be matched with highly qualified staff who can find out their tricks and beat them to it. Well trained efficient and reliable persons should be employed to administer the tax policies so that they will be effectively applied. There should be on the job training for the personnel lacking adequate know how at the moment to increase their performance.
iii. Fast prosecution policy sound is maintained. Penalties against tax evasion are not enough, those who evade tax should be made to pay more than they would have paid have they voluntarily complied. Nigerians trend to relax of they fid out have evaded tax, not much punishment is given to them. Therefore, the revenue department must have a strong, functional and intelligent, legal and investigation sections for this to be possible.
iv. A statuary provision which penalty should be made requiring a good accounting records in the board of internal revenue. There should be adequate internal control in the department so that tax revenues are not embezzled.
v. Further segmentation of the state for assessment purposes is needed crude and subjective means are usually employed in tax assessments. If the state is further divided so that every tax assessor and collector is given the number of people he can successfully assess and collect taxes from within the time period allotted it will be more beneficial.
IMPROVEMENT OF NON-TAX REVENUE
Non-tax revenue sources should be improved. If the state owned companies which have not been functioning are. Made to begin production, revenue occurring to the state will increase. In fact, tax revenue will also increase because more proper will be employed and (PAYE) deducted from their salaries source oil Lagos do not have good roads and brogues linking them with townships where they can sell their farm products. If roads and bridges government revenue will be increased.
Fees from licensees should be increased to reject the needs of the state property rate does not yield so much to the state. From every indication, this revenue source is yet to be fully exploited. It is therefore recommended that all buildings in the urban areas of the state be made to pay appropriate tax.
It is well known fact that the vast potentialities of the state remake largely untapped, in terms of internally generated revenue. This fact is to be considered side by side with the stark reality of the enormous problems that still confront this state especially the problem of grossly inadequate infrastructures.
Another reality that must be considered along with the above is the fact that the revenue due on the state on monthly basis is hardly enough to cover staff salaries as well as to maintain the machinery of the government. There is therefore little lift at the end of each month for capital expenditure. If thins are allowed to continue this ways, would mean that the people will go on year in year out recounting and bemoaning their fate without being able to do much about it.
It is therefore clear that there is other alternative than for the people of Delta state to turn inwards to tap their own resources, in order to really begin the massive transformation which must be carried out in the state. People must come out to pay their taxes and other development levies with the existence of vibrant and internationally reputed major centres of industry and commence. The potentials of Delta state is becoming an independently viable financial entity cannot be disputed. The people must extend maximum co-operation to the various measures already put in place by the government to drastically overhaul the practical of revenue generation and collection in the state.
It is hoped that they will give this co-operation enthusiastically with the fully assurance that the back directly into intensifying the attack on that parental problem of poor infrastructures, namely, roads water, housing and so on.
The authorized revenue collectors of the state government and their agents cannot but be aware of the enormous special responsibilities that lie on them, the successful execution of this task. All feasible and legitimate efforts will be make it facilitate their work as well as encourage them to put in their best. They must realised that all eyes are now on them and surely then know that father on this enterprise is unthinkable. There can be no substitute for honesty and dedication in their work.
Those who have come to regard tax evasion as a way of life must realise that a new era has arrived they should came to understand the direct linkage between taxes they pay and governments ability to improve everybody’s living standard including their own.
Impact Of Taxation On National Development
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