NIGERIAN TAX LAWS: JUDICIAL REACTIONS AND INTERPRETATIONS

Abstract

Taxation constitutes a central component of state functioning, underpinning economic stability, fiscal sustainability and distributive justice. In Nigeria, the legal framework governing taxation has developed through successive statutory interventions, complemented by a substantial body of judicial interpretation. However, ambiguities in legislative drafting, administrative inefficiencies and the fragmented structure of Nigerian tax legislation have created interpretative uncertainties that frequently require judicial clarification. As a result, the courts have become pivotal in shaping the contours of Nigerian tax law, often filling legislative gaps and resolving conflicts among multiple statutory regimes. This paper employs a doctrinal research methodology, drawing on both primary and secondary sources. Primary materials include major federal tax statutes like the Companies Income Tax Act, Personal Income Tax Act, Petroleum Profits Tax Act, Value Added Tax Act and Capital Gains Tax Act as well as leading judicial decisions that have influenced their application. Secondary sources such as textbooks, peer-reviewed articles, law reports and official publications provide analytical context and illuminate broader theoretical and policy considerations. Through a systematic examination of statutory provisions and case law, the study evaluates the judiciary’s role in interpreting ambiguous provisions, protecting taxpayer rights and addressing administrative shortcomings within the tax system. The findings indicate that although Nigerian courts have taken important steps toward clarifying legislative ambiguities and strengthening the protection of taxpayers, inconsistencies in judicial reasoning, divergent interpretative approaches and insufficient statutory reform continue to undermine coherence, predictability and administrative efficiency in tax law. These challenges hinder effective tax administration and weaken public confidence in the tax system. The paper concludes by advocating for the harmonisation of judicial approaches, greater statutory simplification, improved legislative drafting practices and enhanced judicial training on tax matters. Such reforms are essential to developing a more consistent, transparent and efficient tax framework capable of supporting Nigeria’s broader developmental objectives.