The Impact of Tax Systems and Environments on Federally collectible Tax Revenue: A study of some selected States of South-East Nigeria

Abstract

This study ascertain the impact of inadequate tax systems and environments on Revenue generation in selected states in south east Nigeria. The research design adopted for this study was the survey research design. The study made use of primary data obtained through issue of questionnaire based on Likert five point scales. The Taro Yameni formula was used to determine the sample size of three hundred and eighty three (383) respondents from a population of 9021. The sample comprises of thirty(30) FIRS staff and three hundred and fifty three(353) FIRS registered companies in the three states (Enugu, Anambra and Ebonyi). The Pearsons Product Moment Correlation was used to test for reliability of the instrument used (R=0.999). The Pearsons Product Moment Correlation and Ordinary Least Square regression technique were used to evaluate the objectives using SPSS Version 17 statistical software. The study found that poor tax reliefs and allowances have positive correlation with poor revenue generation in south east states of Nigeria; the case of bad administration of taxes results indicates that there is a positive correlation with poor generation. Our findings also show that multiple taxation has positive correlation with poor revenue in south east states of Nigeria and the proxies of inadequate tax base such as quality of tax records (QTR) and Poor Staff Training (PST) indicate that there is a positive correlation between poor revenue generation and of inadequate base. The implications of the finding is that adequate attention must be given to the amelioration of these inadequacies of the level of revenue generation is expected to rise. The study thus recommends that prompt actions on the part of the tax authorities in the area of simplification of tax laws and massive tax education, the training and retraining of tax personnel, the decentralization of tax officers, and the use of information technology for tax payer census and record-keeping will contribute effectively to reduction of tax evasion and avoidance which would lead to increase in tax revenue generation not only in the east states of Nigeria but in Nigeria as a whole.

Keywords: Tax systems, Federally Collectible Tax, Environment