ABSTRACT
The importance of personal income tax to government, both as a
revenue source and as a fiscal policy factor cannot be over emphasized.
In order to achieve this objective, the project work was divided into
five chapters, each chapter dealing with an aspect of the work and
helps to highlight the rudiments which when collated, get the root of
the investigation.
Chapter one deals with the background of the study, statement of
problem, purpose of the study, delimitation of the study, research
questions, statement of hypothesis and significance of the study.
Chapter two deals with the literature review. In this segment I
touched on ideas, opinions and statements of exports and other
interested writers on taxation and relevant legislation relating to
income tax.
Chapter three deals with the research design and methodology.
Chapter five involves the presentation and analysis of data collected from primary and secondary sources.
Chapter five then records up with the findings, discussions of the findings and recommendation.
It is the hope of the researcher that if the recommendations are
impudent, at vast, in part, the effectiveness and efficiency of personal
income tax administration in Ugwuaji community in particular and Enugu
State in general would be assured to a great extent.
PROPOSAL
The importance of personal income tax to government, both as a
revenue source and as a fiscal policy factor cannot be over emphasized.
That is why the writer has decided to conduct a research on the problems
that are facing personal income tax Administration in Rural
communities.
It is the intention of the writer to restrict this study to personal
income tax under the authority of the state Board of internal Revenue
which exclude income tax of air force, police personnel, residents of
federal capital territory, personnel of the ministry of external aspect
of delimitation is that pay as you earn (PAYE) and its administration
will not feature.
The researcher will employ three major instrument for data collection
which are oral personal interview, questionnaire and observation. The
data collected will be analyzed by using question introduced, results
tabulated, text analysis and which chi-square (X2) to test the
hypothesis.
The project work will play the following role in the economy:
i. it will be enable the government to know how effective
and efficient the administrative of personal income tax is.
ii. It will expose any weakness that will be found in the
administration of personal income tax in the rural communities and also
suggest the measures that will be taken in order to correct them.
iii. When there is a proper administration of personal
income tax, citizens will be supplied with all the essential public
goods they needed.
In order to achieve this objective, the project work will be divided
in five chapters, each chapter dealing with an aspect of the work and
help to highlight the rudiment which when collated, get to the root of
the investigation.
TABLE OF CONTENTS
TITLE
Certification
Dedication
Acknowledgement
Table of contents
Abstract
CHAPTER ONE
1.1 Background of the study
1.2 Statement of problem
1.3 Purpose of study
1.4 Delimitation of the study
1.5 Research questions
1.6 Statement of hypothesis
1.7 Significance of the study
CHAPTER TWO
REVIEW OF LITERATURE
2.1 Historical background and development of personal income tax in Nigeria
2.2 General principles and practices of income taxation
2.3 Administration of personal income tax
2.4 Summary of literature review.
CHAPTER THREE
METHODOLOGY
3.1 Research design
3.2 Area of study
3.3 Population of the study
3.4 Sample and sampling procedure
3.5 Instruments for data collection
3.6 Validation of the research instrument
3.7 Reliability of the research instrument
3.8 Methods of administration of research instrument
3.9 Methods of data analysis
CHAPTER FOUR
Data presentation and analysis
CHAPTER FIVE
Designation: implementation: recommendation
5.1 Designation of results
5.2 Implications of the results
5.3 Recommendations
5.4 Suggestions for further research
5.5 Limitations of the study
Reference
Appendix
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Historically, the commonest enemy o the people of rural communities
in all races or cultures is the tax collectors. In the bible, they were
regarded as sinners just for the sake of their freely chosen and
legitimately recognized occupation. In the biblical context, it was even
offensive to meant containing oneself. Imagine the degree of hatred!
The history of other cultures despite the same picture of hatred for
both. The tax (tribute) collectives and their employees. The history of
Empires such as the old Roman Empires, the British Empire, Empire of
Western Sudan and those of Hausa State, just to mention a few, were
sustained by tribute (taxes) paid y their subjects. The common attribute
of all these tributes is that their collection generated a lot of
controversies.
Here in Nigeria, it can be recalled that imposition and payment of
taxes were one of the most outstanding activities of the colonial
Government. Through different methods, the British were able to impose
taxes on the citizens who viewed them as unwarranted extortion and
exploitation. The situation has not changed since independence.
Regime after regime has been face with the problem of resistance of
tax payment y the citizens who, like their colonial generation regard
tax payment as an expenditure in futility, a distasteful exercise, an
avoidable loss, a legalized extortion and punitive measure by the greedy
government. Even the rapid development in education has not done much
to influence the negative attitude towards tax payment.
If the educated elites are precisely, the enlightened populations of
the Urban or civilized areas regard taxes as obnoxious those in the
rural communities would regard it as a taboo for obvious reasons. One
should have witnessed an encounter between tax collection and villagers
to be able to understand the degree of bitterness existing between the
two partners. In fact, a story goes that in one such occasion, a tax
collector was killed! Incidents of this nature resulting during tax
raids in village markets and squares are communities.
Studies show that government do not just imposed taxes without due
consideration of certain underlying principles. It is also know that
money raised through taxes are not just damaged in a dustbin or packed
in a warehouse.
In fact, an appropriate agency of the government explains from time
the users which the tax revenues are part in addition to other reason.
Inspite of the position stated in the above paragraph, revenues from
taxes have continued to be below expectations. On the part of the
taxpayers, the cries have not abated. What a horn of delima! Acts of the
National Assembly, tribunals and tax forces on the issue of tax have
not yielded the desired results.
The following questions, therefore reading come to the mind:
i. Are all the enactment by different regimes relating to tax administration, faulty abomination?
ii. Are the tax laws badly implemented
iii. What are the causes of the citizens’ negative attitude towards tax especially in rural communities
iv. Are there any ways, of collecting the anomalies?
v. Is there a communication problem between the government and the tax payers?
Expanding the above questions in relation to the rural community under study, some more questions such as these would emanate
i. Does the Acts / dress take any cognizance of the issue
of assessable income of self employed person? In other words, what are
the criteria for determining the assessable income of the self-employed?
ii. Is the resulting income tax payable by the people too big or too small?
iii. Are the tax agents and collectors suspected to be dishonest while performing their duties.
iv. Do the rural dwellers actually know the importance of paying tax.
v. What are the causes of the citizen negative attitudes towards tax especially in rural communities?
vi. Has there been any varieties in the methods or
techniques employed over the years and what effect has both of the
methods on the proceed for tax payment?
An effective and efficient tax administration is important since the
revenue from this source is vital to the survival and growth of the
benefiting ties of government.
In a federal system like Nigeria, especially with the continuous
creation state and local government councils, the financial commitment
of the lower ties has continued to grow. To be at par with increased
expenditure, different state have introduced levies such as radio levy,
development levy, education and technology, fund levy, survival levy
etc. all these are to help the government execute some of the programmes
But income tax is unique as a source of revenue to the government
since apart from the primary objective of generating revenue, it serve
to achieve other social economic and political objective. It is
therefore imperative that no amount of attention is too much to be
devoted to ensure efficient tax administration due to the multiple
purpose nature of tax policy. A diligent administration of our tax
policy would ultimately render unnecessary, the imposition of so many
levies in the search of increased revenue.
1.2 STATEMENT OF THE PROBLEM
The problems that inform and create the necessity for studying the
topic of study can be seen in a glance in the following common
observation
i. For every fiscal year, the income tax revenue
particularly from rural communities has fallen short of expectations
ii. There has incessant promulgation and amendment of
personal income tax laws in Nigeria by successive administration without
achieving optimum result, and this calls to question, their suitability
or otherwise for effective income tax administer in rural areas.
iii. The administrative machinery for taxation, just like
any other machinery, is fraught with technical and administrative
problems, which militate against their effective operations.
1.3 PURPOSE OF THE STUDY
Some of the main objective of the study are as follow:
1. To find out the causes of the persistently low revenue
derivable from income tax of rural communities with particular reference
to Ugwuaji community.
2. To explain the reasons behind the negative attitude of the rural dwellers towards payment of income tax
3. To discover to what extent the provisions of different acts
and degrees relating to income tax are applied with regards to
assessment and collection
4. To make recommendation as to how best income tax administration should be carried out to achieve the desired result.