Taxing Power, Equity and Fiscal Federalism in Nigeria
John U. Ihendinihu1, Ogechi E. Alpheaus1, Udochukwu G. Ogbonna2 & Chinedu Ogwo3
1&2Department of Accounting, College of Management Sciences,
This paper examines the constitutional and statutory provisions guiding the taxing powers of the federating authorities/ governments in Nigeria against the principles of fiscal independence/ decentralization, financial stability, administrative efficiency and equity among the federating units. It critics the emerging controversies and judicial rulings on the taxing powers and the revenue sharing schemes available to all tiers of government against the various dimensions of perceived inequity and injustice in the management of resources. The study further noted the likely distortions which the struggle for legislative competence for VAT between the Federal and State governments may create vis-à-vis existing capacities of the States to efficiently administer taxes, enhance social contract, voluntary tax compliance and the ease of doing business in Nigeria. The paper therefore concludes that Nigerian fiscal administration is yet to be operate on the principle of true federalism and recommends the adoption of comprehensive adjustments in the boarders and character of existing systems of tax and other revenue power-sharing among the federating tiers of government in Nigeria in other to enhance the economic circumstances and interest of all levels of government for the benefit of the tax paying publics.
Keyword: Fiscal federalism, taxing power, fiscal independence, financial stability, efficiency, equity