THE PROSPECTS, PROBLEMS AND CONTRIBUTIONS OF VALUE ADDED TAX (VAT) TO NIGERIA ECONOMY Case Study of Federal Board of Inland Revenue VAT Office

TABLE OF CONTENT

Certification.. iii

Dedication.. iv

Acknowledgementv

Table of Contentvii

CHAPTER ONE.. 1

1.0 Introduction.. 1

1.1 Statement of Problems. 4

1.2 Objectives of the Study. 4

1.3 Research Methodology. 5

1.4 Hypothesis. 6

1.5 Significance of the Study. 7

1.6 Scope of Study. 7

1.7 Limitation of the Study. 8

1.8 Definition of Terms. 8

1.9 Plan of Study. 10

CHAPTER TWO.. 12

2.0 Historical Development of Taxation in Nigeria. 12

2.1 History of VAT. 16

2.2 Nature and Operation of VAT. 18

2.3 VAT Accounting Entries. 19

2.4 Administration of VAT. 20

2.5 VAT Registration.. 21

2.6 Duties of Registered Person.. 23

2.7 VAT Returns and Remittances. 24

2.8 Vatable Goods and Services. 25

2.9 ZeroRated Goods and Services. 29

2.10 Offences and Penalties. 30

2.11 Problems of Vat32

2.12 Prospects of VAT in Nigeria. 33

2.13 The Contribution of VAT of the Economy. 35

CHAPTER THREE.. 38

3.0 Research Methodology. 38

3.1 Data Collection.. 38

3.1.1 Primary Sources. 38

3.2 Sources of Data. 39

3.3 Method of Data Collection.. 39

3.4 Sample Technique. 40

3.5 Variables of the Study. 40

3.6 Statistical tool for Testing Hypothesis. 40

3.7 Decision Rule. 41

CHAPTER FOUR.. 42

4.0 Presentation and Analysis of Data. 42

4.1 Introduction.. 42

4.2 Presentation and Organisation of Data. 42

4.3 Testing of Hypothesis. 49

4.4 Testing. 50

CHAPTER FIVE.. 52

5.0 Summary. 52

5.1 Recommendation.. 53

5.2 Conclusion.. 54

Bibliography. 55

Appendix. 56

CHAPTER ONE

1.0 Introduction

The implementation of Value Added Tax VAT in Nigeria started on 1st January, 1994. VAT is a tax on consumption. it is suffered when a person consume vatable goods and services. The enabling Act is the value added tax act 102 of 1993 VATA 1993.

Before the final introduction of the VAT in January 1994, the idea of introduction VAT in Nigeria came from the report of the study group set up by the Federal Government in 1991 to review the entire Tax system. VAT was proposed and a committee was tax set up to carry out feasibility studies on its implementation. And since introduction, VAT has yielded great revenue to the purse of the government.