HISTORICAL DEVELOPMENT
Before the advent of our colonial masters, there were already traces of taxation in existence, for instance in the Northern apart of Nigeria due to the Mohammedanism spirit people were made to contribute towards charity, which was the foundation of taxation there.
But before independence there were axes levied e.g. zakka ( agricultural products), Kurdin, Janghali etc. in other parts of the country that is the Yoruba and the Ibo’s there was a axes developed system of taxation due to decentralization of government powers.
In the cause of his administration Lugard passed many Laws in the Northern Nigeria to enable him to collect the taxes: they were
1)The 1906 Native Revenue proclamation
2)The 1906 Native Revenue proclamation
3)The 1917 Native revenue ordinance
But it was difficult to introduce Native revenue ordinances due to the fore- mentioned reason in the southern parts of the country.
Subsequently to the discrimination in 1957 between the native-direct taxation (colony) ordinance and the non-native income tax (protectorate) ordinance was its replacement by the direct taxation ordinance of 1940 and the income tax ordinance 1943 although it retained its discriminative nature.
Due to the evolving of a federal system of government in the 195’s the income tax ordinance of 1945 was retained to the taxation of non-African and their companies while the 1040 ordinance governed the Africans consequently, to the surprise of many the east which was the last to accept any form of taxation was the first to introduce a comprehensive ordinance with finance law
(No.1) 1956, it was this that introduced the (P.A.Y.E.) the western region income tax law (No 16) of 1951, while the North retained the 1940 ordinance.The 1058 the Rays man fiscal commission recommended the introduction of uniform basic principles of taxing incomes of persons other than limited liability companies throughout the country this was an embodiment in the Nigeria ( constitution) order in council 1960 formed the basis of the present income tax management Act ( the 1961 Act).
Companies and non – residents in Nigeria today are taxed by the federal inland revenue service, while persons other than companies and residents are taxed by the state Board of internal revenue.
TABLE OF CONTENT
Title i
Approval ii
Dedicationiii
Acknowledgementiv
Table of contentv
CHAPTER ONE
1.0Introduction1
1.1The history of tax3
1.2Present day taxation in Nigeria3
1.3Objective of the study4
1.4Significance of the study4
1.5Definition of tax5
1.6Characteristics / objective of modern tax7
1.7Definition of relevant terminologies9
CHAPTER TWO
2.1Tax evasion and tax avoidance11
2.2Definition of tax evasion and tax avoidance12
2.3Evasions as a decision of risk14
2.4Evasion by firms14
2.5The three main streams of avoidance14
2.6Elimination of tax evasion and tax avoidance16
2.7Impact of tax evasion and tax avoidance to the economy19
2.8Taxability or income from illegal trading
CHAPTER THREE
3.0Finding and recommendations20
3.1Findings20
3.2Recommendation21
3.3Conclusion22
Bibliography 23