Improving Tax Audit And Investigation In Nigeria

Improving Tax Audit And Investigation In Nigeria

Chapter One

Preface

Background Of The Study

Taxation worldwide constitutes a major source of profit to the government for the backing of their capital and intermittent expenditures.

Taxation is defined as mandatory tax assessed directly or laterally by the government of a state against the income, profit and wealth of the individual cooperation and commercial realities for the purpose of furnishing social amenities to the people. For illustration, reduction in taxable person( or ménage) income by the quantum paid as interest on home mortgage loans affect in lesser construction exertion and induce further jobs. Udokang( 2011p. 5).

Taxation in Nigeria was constantly operated from the date of independence in 1960. Before 1940 Ordinance Lord Luggard has introduced income duty in Nigeria in 1914 which was known as community duty. Since also, the development of income duty has been greatly told by the provision of the 1954 constitution, which relates to the sharing of income duty profit among categories of government in Nigeria. Udokang( 2011P.1).

In recent times, there has been the appetite for duty authorities in Nigeria to carry out robotic and sporadic duty inspection and disquisition on taxpayers especially commercial bodies suspected of duty elusion or duty delinquency. In doing so, the duty authorities in discharge of their duties as contained in the enabling duty laws, borrow colorful styles in diving taxpayers. The taxpayers on the other hand, are quick to repel any fresh duty burden that might drain their pockets. While duty authorities do have powers to conduct duty inspection and disquisition on taxpayers to insure that the profit due to government aren’t lost by way of false returns, these powers are still, not without legal Limit- duty checkups and examinations are veritably complex and tasking processes and as similar duty directors and their advisers must understand the rules of the game.

The Federal Inland Revenue Service( FIRS) is made up of six directorates which are directorate of value added duty, directorate general of training and exploration, directorate of income duty, directorate of duty payers service, directorate of duty account unit and directorate of duty concurrence instrument. The Federal Inland Revenue Service is a body charged with the responsibility of administering civil government levies in Nigeria. The body has power of administration and collection over the following levies, company income duty, petroleum profit duty, education duty and capital gained duty, particular income duty of residers of civil capital home and account for quantum so collected. The need to train andre-train officers on the specialized aspect of these duties to enable them to be effective and effective in the discharge of their responsibility is veritably necessary. Federal Inland Revenue Service has a lot of practical problems in the process of carrying out their duties of an assessment and collection of levies.

Statement Of The Problem

Government introduces taxation primarily to raise profit to grease the acceptable provision of introductory amenities, security and favourable investment terrain. still, these objects called for a hopeless need for relating the problems challenges associated with duty inspection and disquisition in Nigeria. In Nigeria the incident of duty elusion is veritably high. It’s apparent that one major problem of duty inspection in Nigeria is the weak executive ministry, which makes it easy for duty defaulters to go unpunished or with minimum discipline. The problem of duty inspection is how to simplify and apply the vittles of duty laws and evolve an optimum duty structure that will aim at achieving desirable social pretensions and generally enhance voluntary duty compliance. Income duty administration has a complex operation, this is the reason the preface of the tone assessment system and the establishment of executive ministry of duty inspection and disquisition are welcome development. No duty can conform to anticipated standard of equity, if it can not be administered with a high degree of effectiveness.

thus, this exploration aims at perfecting duty, inspection and disquisition in Nigeria in terms of duty profit and gross domestic product from 2005- 2014.

Objects Of The Study

Grounded on the exploration work, the objects of the study are geared towards achieving the following

To identify the possible relationship between duty inspection and disquisition in Nigeria.

To identify the process which tone assessment system help to reduce the problems of income duty administration in Nigeria.

To identify empirically the sins of duty inspection and disquisition in Nigeria.

To examine whether duty inspection and disquisition helps in the reduction of duty elusion in the Nigerian duty system.

To examine the extent to which duty inspection and disquisition help voluntary compliance by the duty payers.

Statement Of Thesis

The following thesis was drawn up to enable the experimenter formulate variable for the study

H0 There’s no significant relationship between duty inspection and disquisition in Nigeria in terms of duty profit and Gross Domestic Product( GDP)( from 2005- 2014).

H1 There’s significant relationship between duty inspection and disquisition in Nigeria in terms of t

layoff profit and Gross Domestic Product( GDP)( 2005- 2014).

Exploration Questions

The following exploration questions were formulated

What’s the possible relationship between duty inspection and disquisition in Nigeria?

Does tone assessment system help to reduce the problems of duty administration in Nigeria?

Does duty inspection and disquisition reveal sins in the Nigerian duty system?

Does duty inspection and disquisition help in the reduction of duty elusion in the Nigerian duty system?

Does duty inspection and disquisition help voluntary compliance by duty payers?