EXAMINATION OF THE LEGAL PROVISIONS FOR COMBATING TAX AVOIDANCE AND EVASION IN NIGERIA

Abstract

Revenue generation through taxation is an essential ingredient for sustainable development globally. Indeed, taxation is a very potent tool for economic growth and development across the globe. However, the productivity of the Nigeria tax system is low, and the major impediment to revenue generation in the country has been found to be the menace of tax resistance which manifests through the twin monsters called tax avoidance and evasion. This titled Examination of the Legal Provisions for Combating Tax Avoidance and Evasion in Nigerian’ has found that divergent factors account for tax resistance in Nigeria. These include lack of a comprehensive and reliable database of taxpayers, the effect of technological development which has made it possible for businesses to be conducted through the internet, the regime of the multiplicity of taxes in the country, lack of will to enforce tax laws, and the dearth of infrastructural and social facilities provided out of generated tax revenue. Added to the above findings is the fact that the institutional framework in the country is weak and almost lacks powers to effectively check tax abuses, and the Nigeria Courts have in most high profile tax abuse cases exhibited an unwillingness to check incidences of tax evasion. Tax resistance has also been found in this article to have impacted negatively on the economy through substantial loss of government revenue thereby frustrating government developmental programmes. Consequently, deliberate legislative efforts have been made to curb the incidence of tax resistance in the economy. The efficacy of these legislative attempts, though well-intended have not shown the potentials of the desired result. The work finally recommended an amendment of the Taxes and Levies Approved Act to reduce the number of taxes, development of reliable data of taxpayers in the country, amendment of tax laws establishing tax administration bodies, efficient enforcement of tax laws, and provision of infrastructure and social services from tax revenue to enable taxpayers to see the justification for paying tax, as strategies for the way forward.