TAXATION AND LOCAL GOVERNMENT DEVELOPMENT IN NIGERIA CHAPTER ONE INTRODUCTION 1.1 BACKGROUND OF THE STUDY
Ademolekun (2015) noted that one of the recurrent developmental problems facing local government development in Nigeria is dwindling revenue generation as characterized by annual budget deficits and insufficient funds for meaningful growth and viable projects development. This statement implies that local governments have ineffective taxation policies which to a large extent affect their revenue base. Thus, they so much depend on revenue from the federal statutory account. This background brings us to the study of taxation and local government development in Nigeria. Tax has been defined by various authorities and professionals in various ways. Webster’s Dictionary of the English Language defines tax as a charge imposed by government authority on property, individuals or transactions, to raise money for public purpose. Black’s Law Dictionary describes tax as a ratable portion of the produce of the property and labour of the individual citizen, taken by a nation. Tax is a compulsory levy which a government imposes on its citizens to enable it to obtain the required revenue to finance its activities (Adesola, 2014).
Examining the various definitions of tax one observes taxation is very important for any government if it has make any meaningful economic development. Thus, this study is concerned with development at the grass root as being the goals of the local government administration. Thus, in attempt to carryout development at all nooks and crannies of the society, the local government as the tier of government that is nearest to the people is saddled with the responsibility of direct development of the people to a certain level.Development is highly associated with fund, much revenue is needed to plan, execute and maintain infrastructures and facilities at the local government level (Okoli, 2010).
The needed revenue generated for such developmental projects, like construction of accessible roads, building of public schools, health care centers, construction of bridges among others are soles generated from taxes, royalties, haulages, fines and grants from states, national and international governments. Thus, the Local government cannot embark, execute and possibly carryout the maintenance of these projects and other responsibilities without adequate taxation. This is the basic reason why development is skeletal at some Local Government councils in Nigeria. The issue of poor taxation is not exceptional to local government in Edo State, and Uhunmwode Local Government in particular. This however pronouncedly affected development negatively in local government councils. In this research project, the issue to address is how far this poor taxation can affect development especially in Uhunmwode Local Government.
1.2 STATEMENT OF THE PROBLEM
The Local Government Council takes direct care of the grassroots people that is the people in the rural areas. These groups of people sometimes lack essential facilities and condition of modern civilization (Udeh, 2014). They lack pipe bore water to drink, do not have electricity, accessible roads, poor educational infrastructure and facilities to mention but a few. This is one of the major reasons of rural–urban migration of movement. This has made our cities to be congested and increase in many criminal activities.
Based on the above and foregoing assertions, it is oblivious that the impact of poor taxation on the development of the rural area is a serious problem. This might be as a result of poor taxation. If Nigeria is to achieve her desired goal of vision 2020 and possibly meet the millennium development goals (MDGS) target, the issue of taxation must be addressed squarely. Hence the researcher is bothered to find out the impact oftaxation on the lives of people at the rural area and how it has affected development in general especially in Uhunmwode Local Government Area.
1.3 PURPOSE/OBJECTIVE OF THE STUDY
The broad objective of the research is to evaluate the impact created by taxation on the development of Uhunmwode in Abia State. The other objectives of this study include:
To determine the level of modern social amenities available in Uhunmwode. To find out the level of poverty associated with the rural people as a result of poor development To make useful suggestions to solve the problem of poor taxation as development depends on revenue generated.
.