An Assessment Of The Effectiveness And Efficiency Of The Tax System As An Instrument Of Development In Nigeria (1998-2007)

ABSTRACT
Tax as a source of revenue to the federal government has gone down and has continued to do so since the era of the oil boom. But recently, since the world economic meltdown, most governments including ours (Nigeria) has had to look back again at other sources of our revenue. Furthermore, the factors 'inhibiting effective taxation in Nigeria are numerous; principal among them is inequitable distribution of amenities, mismanagement of tax proceeds and lack of political will. This study is to assess the effectiveness and efficiency of the tax system in Nigeria and how efficient its collection has been from (1998 - 2007). The effect of tax revenue non-tax revenue was assessed on the gross domestic product (GDP) for the year under review (1998 - 2007). It was therefore concluded that at 5% level of significance, the tax revenue dose not make a significant contribution to the Nigeria economic development while non-tax revenue collected for the 10 years under review makes a significant contribution to the Nigeria economic development. Increasing the government revenue requires the government to seek improvement in (i) the tax treatment of the taxpayer and administration. (ii) Adequate investment for the tax system. (iii) Judicious spending of the tax payer 's money. Finally, Nigeria must train special tax judges and establish special tribunals; ensure that tax compliance costs are minimal and to adopt the attitude of the taxpayer being the king.