THE JURISPRUDENCE OF CORPORATE INCOME TAXATION IN NIGERIA: A DOCTRINALANALYSIS OF BENEFIT AND ECONOMIC NEXUS THEORIES

Abstract

Corporate income taxation in Nigeria has traditionally been founded on residence and source-based principles. However, evolving business models, digitalisation, and cross-border economic activity have increasingly stressed these traditional foundations. This article undertakes a doctrinal analysis of the jurisprudence of corporate income taxation in Nigeria through the lens of benefit theory and economic nexus theory, examining the extent to which the benefit theory and economic nexus theory provide a coherent justification for Nigeria's evolving corporate income tax regime, especially following the enactment of the Nigeria Tax Act 2025. Using doctrinal analysis, the paper traces the historical development of source-based taxation, critiques the limitations of traditional permanent establishment rules, and appraises the introduction of Significant Economic Presence as a modern nexus standard. The article argues that while benefit theory alone is insufficient as a tool for allocating taxing right, it stands as a compelling normative foundation for taxing income derived from sustained economic participation within Nigeria. The paper argues that economic nexus principle, as reflected in the Nigeria Tax Act 2025, represent a pragmatic response to economic digitalisation, although the success of this reform may depend on doctrinal clarity and innovative enforcement mechanism. The paper contributes to contemporary tax scholarship by creating a nexus between classical tax theories to modern digital taxation reforms in a developing economy context.