It is common knowledge that Nigeria’s tax to Gross Domestic Product (GDP) ratio is one of the lowest in the world. At under 6%, it is far below the sub-Saharan African average of 20%. Nigeria is reputed to be among the countries in the world with the lowest tax compliance rate as recently corroborated by the American billionaire and philanthropist, Bill Gates, who said without the credibility of the Government, Nigerians will not pay tax. Taxation, being a social contract, is expected to be fulfilled by both parties involved, i.e. citizens pay tax while the Government is seen as using such funds for public good. With the relatively low Internally Generated Revenue (IGR) from taxation across the States of the Federation, it is therefore not surprising that the Nigerian economy is heavily dependent on the oil sector to fund its expenditure. According to the International Monetary Fund (IMF), the oil sector accounts for over 95 percent of export earnings and about 40 percent of government revenues.

Read more: https://innerkonsult.com/taxation-in-the-era-of-global-information-exchange/

Contact InnerKonsult for Professional Services on Tax, Accountancy and CAC Services. O8038460036, www.innerkonsult.com