Taxation, Insights

The Taxing Powers of the Government on Value Added Tax (Vat) in Nigeria

INTRODUCTION
It is a truism that no government can function properly without revenue. Revenue helps government meet its numerous responsibilities of improving the quality of life of the citizenry. Cost of governance can only be financed through sustainable source of revenue by the government. One of the major ways a government can actualize and sustain this revenue generation drive is by asking its citizens and corporate entities within its domain to compulsorily contribute a percentage of their income to the coffers of government. This compulsory levy on the citizens and entities is called tax.

In recent times, there has been a sustained drive by the Nigerian government to diversify the economy and reduce its over-dependence on crude oil revenues owing to the volatile nature of the international oil market characterised by fluctuations in oil prices and compounded by dwindling oil reserves. It has thus become risky to continuously depend on the major cash cow of crude oil for sustainable development, as such there has been a consistent effort to shift to other sources of revenue, chief amongst which is taxation…

 

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