1.1 BACKGROUND OF THE STUDY
Nigeria as a nation has the vision of becoming one among the world’s 20 largest economies in the year 2020; this obviously is the brain behind the priority attention the present administration is directing at infrastructural development which is essential for economic growth. A developed economy is one with the ingredient to stimulate investment and create wealth, this by implication offers an atmosphere that is business friendly and has the potentials for the actualization of the vision 202020.
The desired outcome requires a lot of money to put the economy in a position that stimulates investment, therefore, tax policies need to attract potential investors, and the revenue from tax should be sufficient enough to meet the infrastructural expenditures of the government (Worlu, 2012).Apere (2003) notes that taxation is a micro-economic and fiscal policy instrument; it involves the transfer of resources from the private to the public sector for the accomplishment of economic and social goals. It is an instrument the government uses to measure, access and control the informal sector that dominate developing economies of the world (Wambai and Hanga, 2013).This research contends that taxation is an instrument of economic development. Towards this end, this study examines taxation as a tool for economic development using Federal Inland Revenue Service.
1.2 STATEMENT OF THE PROBLEM
Recently, revenue derived from taxes has been very low and no physical development actually took place, hence the impact on the poor is not being felt. Inadequate tax personnel, fraudulent activities of tax collectors and lack of understanding of the importance to pay tax by tax payers are some of the problems of this study. The issues mentioned above will therefore constitute the problem to be addressed by this research work.
1.3 OBJECTIVES OF THE STUDY
i) To examine taxation as a tool for economic development in Nigeria. ii) To find out whether taxation contributed to the development of Nigeria economy. iii) To examine the role of taxation for economic development of Nigeria. iv) To find out the importance of taxation in the development of an economy through proper use of its tools. v) To make possible recommendations based on the findings of this research work.