Data were generated through primary sources and the use of multiple regression analysis was employed. Below is a comprehensive analysis of taxation in nigeria and the necessary rules, laws, and clarifications. Looking at the history of taxation in nigeria, the beginning of the colonization period was connected with various trading posts and companies in the west africa. The role of taxation in promoting economic growth in nigeria is not fully felt, and optimal tax is not been realized that can engine economic growth primarily because of its poor administration. Executive programme tax laws and practice this study material has been published to aid the students in preparing for the tax laws and practice paper of the cs executive programme. Aug 09, 2016 taxation in nigeria and history of taxation in nigeria. Abiola sann, taxation in the guise of administrative charges imperative of curbing abuses of regulatory power for revenue purpose in nigeria. This article is concerned with taxation in general, its principles, its objectives, and its effects. Double taxation agreements treaties nigeria has a number of tax treaties referred to as double taxation agreements with a number of countries. Tax policy, tax legislation and tax administration. A major challenge in nigeria has been the scope and usage. This is in spite of the fact that ignorance is not an excuse of the law. The legal and institutional framework for taxation in nigeria. Paying your tax as an individual or a company is nonnegotiable because tax funds serves as one of the ways the government develops the nation.
Impact of taxation on small and medium scale business in nigeria with abstract, chapter 15, references and questionnaire. Introduction following the emergence of multiplicity of taxes in the nigerian. Taxation in nigeria understanding nigerian tax system. Items comments rate s 401 30% small company tax rate s 406 20%. The bill also seeks to address the taxation of industries, such as insurance, startups and the capital markets, evaluated by the federal government of nigeria as critical to the growth and development of the nigerian economy with a view to stimulating activities in those sectors and fostering overall economic growth. A sample size of 80 respondents, determined by the yaro yamens formula, was selected. That material was based on the law of evidence act, 2004. In other words this is the income actually earned by a taxpayer actual income. Taxation in nigeria understanding nigerian tax system oasdom. Taxation and fiscal regulations in nigeria introduction the nigerian tax system has undergone significant changes in recent times.
The emirs created a system of taxes throughout the north. Customary law taxation historical imposition and collection of tributes for the use of waterways and fishing grounds validity of competency of a native community to collect same based on historical but no longer existing sovereignty proper treatment of. This is in spite of the various pending memoranda and proposals for tax law reform submitted to the federal government by different stakeholders, such as nigerian insurers association, association of food, beverages and. In the united states, the role of the government extends from providing for national defense to providing social security and medicare to the elderly. Thus contracts and supplies of goods and services performed entirely outside nigeria by nonresident individuals are not liable to withholding tax. However, given that the laws of the federation of nigeria are compiled in several volumes, the latest comprising of 14 volumes, it follows that a person whose interest traverses more than one tax type at any given time must necessarily consult several volumes simultaneously. The legal and institutional framework for taxation in. Lb, tax consultant to the oyo state government, nigeria.
You dealt with law 445, law of evidence i in the last session. Taxation and revenue law casesjudgments law nigeria. Obviously, everything about the nigerian taxation cannot be covered in this article, so try to click the links provided on certain text to get a wider scope and explanation. Law and economics of taxation, tax avoidance and tax evasion. Given that the purpose of introducing electronic tax system is to improve revenue collection which will in turn improve the countrys economic growth, the study empirically examined how the implementation of etaxation in 2015 has affected tax revenue, federally collected revenue and taxtogdp ratio.
It is part of the educational kit and takes the students step by step through each phase of preparation stressing key concepts, pointers and procedures. The legal framework and system of taxation in nigeria. The bill proposes fiscal measures in support of the 2020 budget of the federal government of nigeria the fgn, with extensive tax implications for the country. In developing this argument, this thesis gives an overview of oil and gas taxation in both jurisdictions and examines the possibility of transferring laws between nigeria and canada by exploring legal and tax comparative law theories.
Nigerian taxation law, practice and procedures simplified. Acis phd in view lecturer, faculty of law, lead city university, ibadan, nigeria 2bsc, l. Property tax is generally a tax imposed by municipalities upon owners of real property within their jurisdiction based on the value of such property. The basis for the taxation was the islamic religion. Tax types in nigeria is what many nigerians are not aware of. The bill also seeks to address the taxation of industries, such as insurance, startups and the capital markets, evaluated by the federal government of nigeria as critical to the growth and development of the nigerian economy with a view to stimulating activities in.
May 19, 2017 law plays a significant role in fulfilling this. Shortly after the national assembly passed into law, the evidence act 2011. It is payable by companies that are registered in nigeria and non resident entities carrying on business in nigeria. Burning issues in the nigeria tax system and tax reforms. This is usually, by way of a monetary charge imposed by the government on persons, entities, transactions or property to yield public revenue. From these laws, three expressions of partnerships are recognized. May 18, 2018 tax law and tax administration in nigeria, nigeria institute of advanced legal studies. If you earn an income in nigeria whether as an individual or a business, its expected that you remit a given amount of your earnings as tax to the government. Government, tax administrators, practitioners and academics alike. One of the objective carried out by the researcher was. In this chapter, we examine the relationship between taxation and economic growth in a resource rich country, using nigeria as a case study.
Double taxation agreementstreaties nigeria has a number of tax treaties referred to as double taxation agreements with a number of countries. Mar 21, 2018 these will help you run your business legally in accordance with the tax laws and regulations in nigeria. Department of commercial law ahmadu bello university, zaria, kaduna, nigeria email. This form of tax is reported to be one of the most stable sources of revenue to governments however. Managing editor, nigerian tax notes a monthly journal of tax law. Under current nigerian law, taxation is enforced by the. Deemed income assessment taxation generally focuses on a taxpayers earne d income. Unfortunately, we are far behind on tax law reform in nigeria as the last time any business tax legislation was enacted or. Taxation books taxation sa bpp taxation taxation pdf taxation law taxation taxation p6 ngo taxation f6 taxation taxation in png uk taxation what is taxation all about business taxation acca taxation taxation in bangladesh acca tx taxation income taxation pdf taxation with train law taxation.
To start, here are two basic facts about taxation in nigeria. As an individual or a business in nigeria, you are liable to the payment of any tax and you fail to pay it, ignorance of the law cannot be used as a genuine excuse for such act of omission. Principles and practice of taxation in nigeria, 2 nd ed. Tax and taxation in nigeria europeanamerican journals. A radical shift to indirect taxation, given the low cost of.
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. By taiwo oyedele the personal income tax amendment act 2011 was officially gazetted on tuesday 31 january 2012 with an effective date of 14 june 2011. Administration of the tax 1 the tax shall be administered and managed by the federal board of lnland revenue in this act referred to as the board. The ttest was used to establish sufficient evidence that the. The importance of taxation lies primarily in its ability to raise capital formation of government. The paper in discussing the subject has focused on the principal tax legislations in the country, namely, the personal income tax act, companies. These will help you run your business legally in accordance with the tax laws and regulations in nigeria. This is to ensure that the tax payable in nigeria on the profits of a nigerian company being remitted into the country are reduced by the amount of foreign tax paid abroad and vice versa. In consequence, the income tax management act of 1961 was enacted and amended in 1975. Pdf tax evasion and the law in nigeria researchgate.
It is a practice that was hardly known to customary law. As a result, the gb exploited the resources and people of africa. The nigeria tax system, like any tax system, is a tripartite structure which comprises of. Minimum tax section 33 of companies income tax act cita cap c21 lfn, 2004 as emended jan 2009. Although the history is interesting, for 1 unit 01. Iclg corporate tax laws and regulations nigeria covers common issues in corporate tax laws and regulations including capital gain, overseas profits, real estate, antiavoidance, beps and the digital economy in 33 jurisdictions. Nigerian law proviso sections 68 to 72 of the personal income tax. Jan, 2020 the bill also seeks to address the taxation of industries, such as insurance, startups and the capital markets, evaluated by the federal government of nigeria as critical to the growth and development of the nigerian economy with a view to stimulating activities in those sectors and fostering overall economic growth. Tax system the nigeria tax system is made up of tax law, tax policy and tax administration. Sep 05, 2018 personal income tax amendment act, 2011 pitam is the principal act for the taxation of employees in nigeria. Current law and practice of value added tax in nigeria abiola sanni, department of commercial and industrial law, university of lagos, nigeria abstract the value added tax vat was introduced in nigeria in 1993 by the federal military government.
Ordinary least square ols estimation technique is employed in estimating the specified. My hope however, is that other professionals, judicial officers and persons interested in the study or practice of taxation will also find it useful. The british empire tried to fight for economic dominance in the region. Various nigerian constitutions have attempted to allocate taxing. Since then, the value added tax decree, had been amended. Corporate tax 2020 laws and regulations nigeria iclg. For law officers, it also means an extra burden of having to carry several law volumes when appearing before the courts or tribunal.
The book simplifies the basics of nigerian taxation, discusses different laws, practice and procedures in the nigerian taxation, contains the current law position based on the latest amendments to nigerian tax laws, and treats the issue of islamic taxation and its legality under the nigerian law. Law of evidence ii this is the second part of the law of evidence. Trust law and the administration of real property in nigeria ibrahim abdulkarim department of private law, faculty of law ahmadu bello university, zaria, nigeria email. Impact of etaxation on nigerias revenue and economic growth. Introduction to taxation our purposes, the sections on tax structure, types of tax, tax. Aviation laws and regulations nigeria covers common issues in aviation laws and regulations including aircraft trading, finance and leasing, litigation and dispute resolution in 35 jurisdictions. Burning issues in the nigeria tax system and tax reforms on. It requires clear perception of fiscal terms and concepts as well as. Abiola sanni, phd, fcti senior lecturer department of commercial and industrial law university of lagos, nigeria 1.
Abstract taxation is the nucleus and the path to modern development because it is one of the formidable options to generate revenue by government. Many employers are yet to commence implementation while some. The principal law is the companies income tax act cita which imposes cit on profits accruing in, derived from, brought into or received in nigeria. The sale of real estate properties is subject to a 10% tax on the gains. Read it with the goal of gaining a broad understanding of tax purposes and principles. As events unfolded, before the colonization period in nigeria, the tax system was traced to the northern parts of the country. The division of taxing powers in a country invariably depends on the system of government, whether it is federal or unitary. In addition to the printed version of the wwtg, individual country taxation guides are available in pdf format which can be downloaded from the pkf website at. In nigeria, nobody can dispute the fact that though this taxes are been collected, they are.
Value added tax vat in nigeria is levied on all products and services traded within the country and payable to government at a 5% rate, one of the lowest in the world. Taxes are levied in almost every country of the world, primarily to raise revenue for government expenditures, although they serve other purposes as well. Aviation law 2020 laws and regulations nigeria iclg. Atilola is also the editorinchief, nigerian tax law reports 19602010. This study examined the burning issues in the nigeria tax system, tax reforms, and how they affect revenue generation in river state, nigeria. Pdf an assessment of the prospects of property tax. Taxation of individuals 3 monthly tax rates 3 income from employment 3 personal relief 3 contributions to retirement benefit schemes 3 interest incurred by an individual on residential premises 4 noncash benefits 4 taxation of loan benefits 5 nontaxable benefitsincome 5 taxation of overtime and bonus 5 payment to temporary and casual. It is understood that any copying or publication or use of this thesis or parts thereof for financial gain shall not be allowed without my written permission. Taxation and fiscal regulations in nigeria nigerian law guru.
However, tax evasion and tax avoidance are important factors to be considered as they affect both the volume and nature of government finances which is the key to economic development. Impact of etaxation on nigerias revenue and economic. Double taxation agreement dta transactions that are ordinarily not liable to tax in nigeria are not liable to withholding tax in nigeria. Taxation and economic growth in a resourcerich country. An appraisal of the legal framework for taxation in nigeria. 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. Tax policy forms the basis for tax laws while tax administration is the implementation of the tax laws. We explore the linkages between availability of higher resource revenue and lower taxation effort of other revenue categories and the effects of these on growth. Sections 60 to 64 of the company income tax act as amended, and. This study examined the impact of etaxation on nigerias revenue and economic growth. 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. This book is primarily conceived for the convenience of tax officials. Chapter 2, legal framework for taxation 4 corrected by constitutional amendment, the supreme court read the amendment relatively narrowly, taking to itself the decision as to whether a statute taxed income within the meaning of the amendment.
Introduction to taxation government plays an important role in most modern economies. Taxation and fiscal regulations in nigeria nigerian. The federal inland revenue service firs is the federal government agency in nigeria responsible for the administration and collection of taxes. The objective of this study is to investigate the impact of taxation on economic development of nigeria proxy by the gross domestic product gdp. Many of the reference books were also written prior to the 2010.
Federal inland revenue service firs we do our best to provide accurate and up to date information. Withholding tax in nigeria administration and rates. Taxation in nigeria plus history of taxation in nigeria. Taxation, imposition of compulsory levies on individuals or entities by governments. Taxation of partners and partnerships in nigeria ololade olukowi 2 lagos, though, has since outgrown the western region. All companies operating in nigeria outside the oil and gas sector of the economy are.
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