Fiscal Federalism and Development in Nigeria

Abstract

It is a known fact that the pattern of fiscal federalism the military imposed on the nation has no regard for the source of production and revenue generation. This is so through the power bestowed upon the federal government by the constitution which gave the federal government power over taxation and payment collection, the same constitution also vested the power of ownership of natural resources in any part of the country on the central government, and this has gone a long way to balkanized revenue generation effort and made development Epileptic and subjecting states as agents to the federal government. The 1963 Republican constitution, 1979 constitution, 1989 constitution and 1999 constitution made it possible in Nigeria, and conflict are still “brewing”. In finding solution to this problems, this paper would x-ray on the following issues; problem of Nigerian fiscal federalism, theory of fiscal federalism. problem of acceptable sharing formula, objective of fiscal relations, importance of fiscal federalism to national development, revenue allocation principles in Nigeria, effect on development in Nigeria and to suggest a way forward for an improved fiscal federalism so as to reduce the internal heat that has led to the ethnic cold war in the polity.

Keywords: Fiscal Federalism, Development, Revenue, Nigeria, Government.