AN INVESTIGATION OF THE ROLE OF GOVERNMENT MINISTRIES/ DEPARTMENTS AND AGENCIES IN THE COLLECTION AND REMITTANCE OF VALUE ADDED TAX IN NIGERIA

Abstract

This research effort is an investigation of the role of the MDAs in the collection and remittance of Value Added Tax in Nigeria. This study has become necessary considering the provision of the new Tax Reform Bill that centralized the collection of Taxes to be performed only by the newly formed Nigerian Revenue Service. The doctrinal approach was adopted in this research with information from Tax Laws, case laws and literature review of the research efforts of other writers. It was found from this research effort that the MDAs were collecting and remitting Taxes to the government. It was also found that due to some challenges, some of these MDAs were not performing optimally in their assigned role as VAT agents. It was further found that with the new Tax Reform Bill, MDAs would discontinue performing their agency role with the centralization of Tax collection, which would now be performed by the newly created Nigerian Revenue Service. Based on this, it was recommended that instead of centralizing Tax collection in Nigeria, Tax Authorities should strengthen their partnership with MDAs so as to perform more effective supervisory role with regular audit of these MDAs. Secondly, MDAs have established structures in the performance of this role and what is needed is to make these structures more effective and efficient instead of scrapping them. Besides, centralization of Tax collection has its own challenges-manpower and logistics challenges, bureaucratic inefficiencies etc. which may actually lead to revenue loss to the government with the new policy.