HARNESSING TAXATION AS A REFORMATIVE TOOL FOR THE NIGERIAN OIL AND GAS SECTOR: LESSONS FROM CANADA AND NORWAY⃰

Abstract

Nigeria is a country heavily dependent on its oil and gas industry. The sector has historically been the mainstay of the economy, accounting for a significant portion of the country's GDP and foreign exchange earnings. However, despite its importance, the oil and gas industry in Nigeria has been plagued by a number of challenges, including corruption, inefficiency, and underinvestment. As a result, there is a need for significant reforms in the sector. This article explores the potential for taxation to be utilized as a reformative tool for the Nigerian oil and gas sector, drawing on the experiences of Canada and Norway. Both countries have implemented comprehensive taxation systems to incentivize environmental responsibility and diversify their energy sectors. In carrying out this research, the researcher employed the doctrinal method of research wherein the comparative, descriptive and analytical approaches were adopted. Also the primary sources of legislation, books and judicial authorities as well as secondary sources of journal articles, publications etc were used. This work found that Nigeria could learn from the Canadian and Norwegian experiences by introducing tax incentives for renewable energy and energy-efficient technologies, implementing a carbon pricing scheme, and introducing a comprehensive taxation system that includes a petroleum tax, CO2 tax, and special tax on petroleum income. The revenues generated could be used to fund social welfare programs and infrastructure development. This paper also found out that to ensure transparency and public trust, it is important that the taxation system is implemented and managed effectively. The researcher concluded that taxation has the potential to be an effective tool for reforming the Nigerian oil and gas sector if implemented with care and attention to local circumstances. Recommendations were made which suits the different phases of the challenges and inefficiencies.