Thesis Abstract

Abstract
The rapid advancement in technology has led to the adoption of e-taxation systems by many countries as a means to enhance tax compliance and increase government revenue. This research focuses on Nigeria and examines the effect of e-taxation on government revenue in the country. The study utilizes both qualitative and quantitative research methods to analyze data collected from various sources including government reports, academic publications, and interviews with tax officials. The findings of the study reveal that the implementation of e-taxation in Nigeria has had a positive impact on government revenue collection. The use of electronic systems for tax administration has improved efficiency, reduced tax evasion, and increased compliance among taxpayers. The introduction of online platforms for tax filing and payment has made the process more convenient and transparent for taxpayers, leading to a higher rate of voluntary compliance. Furthermore, the study highlights the challenges and limitations of e-taxation implementation in Nigeria. These include issues related to internet access and digital literacy among taxpayers, as well as concerns about data security and privacy. The research suggests that addressing these challenges through targeted policies and investments in technology infrastructure is crucial for maximizing the benefits of e-taxation in Nigeria. Overall, the research demonstrates that e-taxation has the potential to significantly enhance government revenue in Nigeria. By leveraging technology to streamline tax administration processes and improve compliance, the government can increase revenue collection and reduce reliance on oil revenues. The study underscores the importance of continuous monitoring and evaluation of e-taxation systems to ensure their effectiveness and sustainability in the long run. In conclusion, the findings of this research contribute to the existing literature on e-taxation and government revenue in developing countries, particularly in the context of Nigeria. The study provides valuable insights for policymakers, tax administrators, and researchers seeking to understand the impact of digital transformation on tax systems and revenue generation. It also offers recommendations for enhancing the effectiveness of e-taxation initiatives to support sustainable economic development and fiscal stability in Nigeria and beyond.

Thesis Overview

INTRODUCTION

1.1     Background to the Study

It is obvious that the Nigeria’s revenue from oil can no longer fully support her development objectives due to the serious decline in price of oil in recent years which has led to a decrease in the funds available to the Government. Therefore there is the need for government to generate revenues internally to help finance her public expenditures. This need underscores the eagerness on the part of government to look for new sources of revenue or to become aggressive and innovative in the mode of collecting revenue from existing sources. One of these existing sources is taxation. To help the government to achieve better revenue collection, there is a need for her to introduce a better and convenient way to collect tax for her citizens which is through electronic taxation.

Taxation is considered to be a means of generating revenue by government for the purpose of providing essential amenities for her citizens (Okauru, 2014). Taxation globally, is a function of reciprocity (Okauru, 2014). While the government is responsible for the empowerment of the citizens through the provision of jobs, infrastructure and other development projects, and in return, citizens are usually expected to perform their own obligations, in which the principal of it is payment of taxes (Okauru, 2014). Revenue generated from citizens’ taxes are usually recycled by the government in the area of provision of basic amenities such as pipe borne water, road network, electricity, schools, and the likes (Okauru, 2014).

The reality on ground in Nigeria is that governments at all levels have to put more efforts by embarking on an aggressive tax drive, when we consider the dwindling revenue profile resulting from the fall in oil prices. Therefore, Nigerians have to come to terms with the present reality. Taxes can be in various forms, ranging from personal direct tax, indirect tax, income tax, value added tax and companies income tax, to mention but a few. In order to bridge the gap in terms of revenue accruals, there is the need for government to embark on aggressive taxation which is the most recognized and plausible means of generating revenue for social services across the globe. The Vanguard of December 15th, 2015 indicates that revenue accruable from Value Added Tax (VAT) from March to June 2015 came to about N376 billion, but this figure doubled between July and December.

The reason for this can be traced to the Federal Government’s effort towards diversification of revenue sources in the country. With compulsory tax laws and enforcement, there is no doubt that Nigeria can stand the test of the uncertainties in the international oil market. This implies that there will be availability of more revenue for the government to cater for the needs of the Nigerian citizens. This is the most suitable time for Nigerians to welcome the tax system with open arms. Through this, Nigerians can be involved in the contributory social contract by paying their taxes regularly knowing that the government on its part would observe its obligation by not looting or misappropriating taxpayers’ money.

It is no longer news that Nigeria has finally lost its position as the main supplier of oil to the United States of America and therefore, needs to embrace revenue diversification which can be achieved through taxation as the alternative means of revenue generation in order to withstand the dwindling revenue from oil. However, there is the need to harmonize the tax system and ensure collaboration between government tax agencies and professional tax institutes and consultants. The reliability of the institutional framework for tax processing and enforcement must not be questionable to ensure sustainable development through taxation.

1.2     Statement of the Problem

According to Lolade (2005) the main function of taxation is to generate money for government expenditure. According to the Nigeria National Tax Policy (2012) taxes helps the government in generating sufficient resources for government to provide basic public goods and services. Nigeria has yet to rip the full benefit of taxation as experienced in developed countries of the world. In fact, Ayua (1996) observed that the problem with Nigeria tax administration is grossly inefficient with respect to its procedures, machinery and approaches adopted in collection of taxes, alongside the corrupt practices of tax officials in implementing tax system. Moreover, Ayua (1996) also opined that the Nigeria tax system is grossly inadequate as it is characterized with tax evasion, avoidance and record falsifications which account for the consistent low tax yields.

Careful observation points to the oil boom which has been an enduring blessing to Nigeria which regrettably brought about a great shift of attention to oil money, which results to a total neglect of other sectors including agriculture in Nigeria. The adverse effect of this boom and euphoria led to the neglect of other sectors from which revenue can be generated by the government to provide basic amenities for her citizens. One of the best ways the government can use to generate revenue during this period of dwindling of oil revenue is through tax. Unfortunately, this has been neglected by the government. Unless aggressive tax system is being introduced by the government to ensure the citizens pay their taxes as at when due, Nigeria will remain in this economic shackles for long. Over the years, revenue derived from taxes has been very low and no physical development actually took place, thus the impact on the poor is not being felt. Inadequate tax personnel, fraudulent activities of tax collectors and lack of understanding of the importance to pay tax by tax payers are some of the problems that we are currently facing in ensuring effective tax revenue in the country. Therefore, this study will throw more light on the effect of e-taxation on government revenue in Nigeria by focusing on the pre-post analysis of taxation in Nigeria.

1.3   Research Question

This study will be carried out to answer the following questions:

i)  What are the effects of e-taxation on government revenue in Nigeria?

ii) What are the measures taken by the government to ensure effective and prompt e-tax payment by tax payer in Nigeria?

iii) What are the challenges facing taxation systems in Nigeria?

1.4   Objectives of the Study

The study has both general objective and specific objectives. The general objective or main objective of this study is to investigate the effect of e-taxation on government revenue in Nigeria by focusing on the pre-post analysis of taxation in Nigeria. The specific objectives are:

i)  To examine the effects of e-taxation on government revenue in Nigeria

ii) To identify the measures taken by the government to ensure effective and prompt e-tax payment by tax payer in Nigeria

iii) To investigate the challenges facing taxation systems in Nigeria

1.5   Research Hypothesis

The followings are the research hypotheses to be tested in this study:

i) There is a significant relationship between e-tax payment and government generated revenue

ii) There is no significant correlation between e-taxation and acceptance of the method by the citizens

1.6   Significance of Study

The results from this study will educate the stakeholders vested with the management of Nigeria’s economy and the general public on how huge revenue capable of replacing oil revenue can be generated through taxation and its effect on national development. Findings from this study will also educate the government of Nigeria and the general public on the effectiveness of the institutional framework saddled with the responsibility of collection and enforcement of tax duties. This research will be a contribution to the body of literature in the area economy, accounting and public administration thereby constituting the empirical literature for future research in the subject area.

1.7   Scope and Limitation of the Study

This study will cover the process of e-taxation in Nigeria. It will as well cover the activities of the tax collection and enforcement officers.

1.8   Limitations of the Study

The Major Limitations of the study will be:

Cost Limitation: There will be a cost limitation. This means that the researcher will not offer any gift or monetary incentives for the respondents to answer the questionnaire. This might result in certain prospective respondents choosing not to respond to the researcher. Time Limitation: There are two types of time limitation that will be faced during the study. The study will be done for a period of four weeks. Hence the results would reflect the impact of the time constraint. The insights of the respondents will be observed during the period of the study. A more extensive study conducted over a larger time period or during a special period of time like when there will be higher numbers of issues, can include insights from respondents over a broader time period and can bring in further depth into the research.