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CHAPTER ONE

INTRODUCTION

1.1  BACKGROUND OF THE STUDY

A tax could be defined as a compulsory payment levied on individuals by government for paying a specific percentage of their earning or a specified amount in order to raise revenue for development purposes. A tax according to Agyei (2013) could also be defined as the transfer of resources from the private to the public sector in order to accomplish some of nations economic and social goals. Other learned educationist defines tax from his or her own understanding.  Well, the primary goal of developing economic growth and hence the per capital income which will lead to higher standard of living. The goals, which will be achieved with the introduction of the tax, are: provision of additional basic government services, particularly in education public health and transport, which are imperative for the growth of the rest of the economy.

Income tax was first introduced in the year 1904 by late lord lugard in Nigeria when community tax becomes operative in northern Nigeria. Formally, Nigerians cheerfully paid their taxes in kind by rendering free services such as learning the bush, digging pit toilets, wells etc. for the benefit of the community as a whole. Failure to render such service usually resulted in seizure of property, which mighty be reclaimed on payment of money. In 1917, lord lugard made certain changes, which eliminated in the native revenue ordinances. It was the 1972 ordinance that was extended to the eastern Nigeria in 1928. The still opposition was also made, at the end of 1929. Chief okugo of okpoko carried out the instruction laid down by that British admmistration on a new way of taxation will be introduced. It’s introduction later culminated in Aba women riot against the British administration  (w.s. okeke 2017).

Meanwhile, in the year 1799, taxation was introduced in Britain by the former king William pit as a means of raising revenue and catering for government expenditure. Income tax was effective in northern Nigeria but finally has come to stay in Nigeria today. The raise man fiscal commission of 1958 recommended the introduction of basic principle for, taxing income persons other than companies. This recommendation was embodied in the Nigeria constitution order in council, 1960 and which forms the basis of income tax management act of 1961. By the virtue of edict in 1970, the board of internal revenue came into being. In effect, the board is the organ charged with the carrying out board-based policies of tax administration in Enugu state.  

1.2  STATEMENT OF THE PROBLEM:

This work is concerned with Enugu, finding out the problem and prospect of income tax collection. In discussing the problems of personal income tax well, these problems hinder the provision of various services ranging from security to economic services for the citizens. Though the funds, which would have been collected, are not available to the government thereby, creating instability of the economy. 

Well, those problems could be easily enumerated as bellow:

i.  Lack of staff and input such as stationery vehicles and effective legislation to cover the tax officials.

ii. Lack of appropriate incentive to officials,

iii. Inadequate public enlightenment on taxpayers.

iv. Lack of adequate information of taxpayers source of income.

v. Some tax payers are not prepared to pay their tax at will, unless they are forced which give rise to their coming.

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