TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA

TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA   CHAPTER ONEINTRODUCTION 1.1 TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA: BACKGROUND TO THE STUDY  

Nigeria is currently not enjoying the best of times. The country is presently suffering the adverse effects of the dwindling revenue from crude oil and gas sector, which today accounts for about 95 percent of its revenue. The fallen price of crude at the world market has orchestrated the devaluation of the Naira and increased inflation. The manufacturing and other productive sectors are worst hit because, as the country is highly import-dependent, they find it extremely difficult to bring in raw materials, especially now that the central bank has closed its auction market window. The dollar is expensive to procure at the interbank window and the black market. More worrisome was the need for the government to review its 2015 fiscal policy by slashing the benchmark of oil, in the 2015 budget from $120 to $75, and now to $53. The implication of the budget review may not manifest now (Vanguard, 2015). It may result in a scale down in the capital and recurrent spending. That alone can translate to a reduction in money in circulation.

Looking at what this portends for the nation should this trend continue unchecked, experts have called on the government not to fold its hands, but to explore other potential sources of revenue through the diversification of the nation’s economy (Dike, 2015). While some urged the government to redirect its focus to the agriculture sector, others asked the government to explore the numerous mineral resources for an alternative source of income. Yet, few others said Nigeria, like many other advanced countries, can rely on tax revenue for survival. However, this study is examining taxation as an alternative to the dwindling oil revenue in Nigeria.

Taxation is a means of generating revenue by the government for the purpose of providing social services to the people (Okauru, 2014). Taxation all over the world is a function of reciprocity (Okauru, 2014). While the government owes it as a duty to empower the citizens by providing jobs, infrastructure, and other development projects, the citizens are usually expected to reciprocate by performing their own obligations, principal of which is the payment of taxes (Okauru, 2014). Revenue generated from citizen’s taxes is usually recycled by the state (government) in the area of provision of basic amenities such as water, roads, electricity, schools, among others (Okauru, 2014).

The new reality considering the present situation in Nigeria is that governments at all levels have to raise the bar by embarking on an aggressive tax drive, considering the dwindling revenue profile arising from the fall in oil prices (Dike, 2015). Therefore, Nigerians have to come to terms with the present reality. Taxes come in various forms, ranging from personal income tax, value-added tax, and the company's income tax, among others. To bridge the yawning gap in revenue accruals, there arose the need for the 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 from January to June 2015 came to about N376 billion, but this figure has doubled since July till December. The reason, of course, can be attributed to the Federal Government’s commitment towards diversification of revenue sources. With aggressive tax laws and enforcement, there is no doubt that Nigeria can withstand the shocks of the uncertainties in the oil market. What this means is that there will be more revenue available for the government to cater to the needs of the Nigerian people. This is the best time in our history for Nigerians to embrace the tax system. By this, Nigerians can be involved in the contributory social contract by paying their taxes regularly. 

1.2   TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA: STATEMENT OF THE PROBLEM  

According to reports that Nigeria has lost its position as the lead supplier of oil to the United States of America, there is the need for the Nigerian government to diversify its revenue base through taxation as the alternative means of revenue generation in order to keep fit in the face of dwindling revenue from oil. However, there is a need to harmonize the tax system and ensure collaboration between government tax agencies and professional tax institutes and consultants. The government needs to practically shift attention from oil to the development of other revenue sources especially non-oil exports to support internally generate revenue from taxes. The reliability of the institutional framework for tax processing and enforcement must not be questionable to ensure sustainable development through taxation. However, this study is examining taxation as an alternative to dwindling oil revenue in Nigeria.

1.3   TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA: OBJECTIVES OF THE STUDY    

The following are the objectives of this study:

To examine taxation as an alternative to dwindling oil revenue in Nigeria. To examine the effect of taxation on the taxation economy and development in general. To examine the effectiveness of the institutional framework for the collection and enforcement of tax duties.

1.4   TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA: RESEARCH QUESTIONS

Can taxation serve as an alternative to dwindling oil revenue in Nigeria? What is the effect of taxation on the taxation economy and development in general? What is the effectiveness of the institutional framework for the collection and enforcement of tax duties?

1.5   TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA: HYPOTHESIS  

HO: Taxation cannot serve as an alternative to dwindling oil revenue in Nigeria.

HA: Taxation serves as an alternative to dwindling oil revenue in Nigeria.

1.6   TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA: SIGNIFICANCE OF THE STUDY  

The following are the significance of this study:

The results from this study will educate the stakeholders saddled 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 the collection and enforcement of tax duties. This research will be a contribution to the body of literature in the area of the effect of personality traits on student’s academic performance, thereby constituting the empirical literature for future research in the subject area.

1.7   TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA: SCOPE/LIMITATIONS OF THE STUDY  

This study will cover the process of taxation in Nigeria. It will also cover the activities of the tax collection and enforcement officers.

TAXATION AS AN ALTERNATIVE TO DWINDLING OIL REVENUE IN NIGERIA: LIMITATION OF STUDY  

Financial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature, or information and in the process of data collection (internet, questionnaire, and interview).Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted to the research work.

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How To Write Chapter Three Of Your Research Project (Research Methodology)

  • Methodology In Research Paper


    Chapter three of the research project or the research methodology is another significant part of the research project writing. In developing the chapter three of the research project, you state the purpose of research, research method you wish to adopt, the instruments to be used, where you will collect your data, types of data collection, and how you collected it.

    This chapter explains the different methods to be used in the research project. Here you mention the procedures and strategies you will employ in the study such as research design, study design in research, research area (area of the study), the population of the study, etc. You also tell the reader your research design methods, why you chose a particular method, method of analysis, how you planned to analyze your data.

    Your methodology should be written in a simple language such that other researchers can follow the method and arrive at the same conclusion or findings.

    You can choose a survey design when you want to survey a particular location or behavior by administering instruments such as structured questionnaires, interviews, or experimental; if you intend manipulating some variables.

    The purpose of chapter three (research methodology) is to give an experienced investigator enough information to replicate the study. Some supervisors do not understand this and require students to write what is in effect, a textbook.

    A research design is used to structure the research and to show how all of the major parts of the research project, including the sample, measures, and methods of assignment, work together to address the central research questions in the study. The chapter three should begin with a paragraph reiterating the purpose of research. It is very important that before choosing design methods try and ask yourself the following questions: Will I generate enough information that will help me to solve the research problem by adopting this method?

    Method vs Methodology

    I think the most appropriate in methods versus methodology is to think in terms of their inter-connectedness and relationship between both. You should not beging thinking so much about research methods without thinking of developing a research methodology.

    Metodologia or methodology is the consideration of your research objectives and the most effective method and approach to meet those objectives. That is to say that methodology in research paper is the first step in planning a research project work.

    Design Methodology: Methodological Approach

    Example of methodology in research paper, you are attempting to identify the influence of personality on a road accident, you may wish to look at different personality types, you may also look at accident records from the FRSC, you may also wish to look at the personality of drivers that are accident victims, once you adopt this method, you are already doing a survey, and that becomes your metodologia or methodology.

    Your methodology should aim to provide you with the information to allow you to come to some conclusions about the personalities that are susceptible to a road accident or those personality types that are likely to have a road accident.

    The following subjects may or may not be in the order required by a particular institution of higher education, but all of the subjects constitute a defensible in metodologia or methodology chapter.

    Click here to complete this article - How To Write Chapter Three Of Your Research Project (Research Methodology)

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