ABSTRACT The purpose of this study is to find out if actually there is an impact of taxation as aid to economic development and my study is based on the survey of Enugu State, using Oji River as a case study. This research also became necessary in order to bring to the proper understanding of the enquirer the best ways to solve such problems connected with the taxation especially: what is taxable, which system of tax is acceptable, the rate of tax evasion and avoidance and the assessment of Nigeria tax system. The primary function of every government is to make provision for its citizens in terms of infrastructural facilities. The provision of this enormous work cannot be carried out adequately by the government due to its limited resources therefore, there is the imposition of tax on all citizens, companies to augment government financial position. Government have always enacted various tax laws and reformed to stand the taste of time.

Table Of Content Title Page Approval Page  Dedication  Acknowledgement Table Of Contents

Chapter One 1.0 Introduction 1.1 Statement Of Problem 1.2 Objective Of The Study 1.3 Significance Of The Study 1.4 Limitations Of The Study 1.5 Assumptions 1.6 Formulation Of Hypothesis 1.7 Definition Of Terms

Chapter Two 2.0 Review Of Related Literature 2.0.1 Introduction 2.1 Definition Of Tax 2.2 Types Of Taxation 2.3 Incidence Of Taxation 2.4 Principles Of Taxation 2.5 Elements Of Taxation 2.6 The Importance Of Taxation In EdoStatement Economy 2.7 Structure And Administration Of Nigeria Tax System 2.8 Appraisal Of Some Tax Legislation 2.9 The Problems Of Taxation And Its Function

Chapter Three 3.0 Research Methodology 3.1 Introduction 3.2 Research Design 3.3 Primary Source Of Data 3.4 Secondary Source Of Data 3.5 Population 3.6 Sampling Techniques 3.7 Sample Size 3.8 Remarks

Chapter Four 4.0 Introduction  4.1 Presentation Of Related Data 4.2 Analysis Of Related 4.3 Testing The Hypothesis

Chapter Five 5.0 Discussion, Conclusion And Recommendation 5.1 Discussion 5.2 Summary/Conclusion 5.3 Recommendation Bibliography

CHAPTER ONE

1.0 INTRODUCTION: 1.1 BACKGROUND OF THE STUDY: One of the major functions of any government especially developing countries such as Nigeria is the provision of infrastructural services such as electricity, pipe-borne water, hospitals, schools, good roads and as well as ensure a rise in per capita income, poverty alleviation to mention a few. For these services to be adequately provided, government should have enough revenue to finance them. The task of financing these enormous responsibilities is one of the major problems facing the government. Based on the limited resources of government, there is need to carry the citizens (governed) along hence the imposition of tax on all taxable individuals and companies to augment government financial position. To this end, government have always enacted various tax laws and reformed existing ones to stand the taste of time. They include: Income Tax Management Act (ITMA), Companies Income Tax Decree (CIID), Joint Tax Board (JIB) etc. All these are aimed at ensuring adherence to tax payment and discouraging tax evasion and avoidance. For the purpose of this study, the researcher would be concerned with the impact of taxation as an aid to the economic development of Enugu State (Nigeria).

1.2 STATEMENT OF THE PROBLEM: The first need of any modern government is to generate enough revenuewhich is indeed “the breath of its nostril”. Thus taxation is by far the most significant source of revenue for the government. Nigerians regard payment of tax as a means whereby government raises revenue on herself at the expense of their sweat. It is good to note that no tax succeeds without the taxpayer’s co-operation. Here, we can ask some thought-provoking questions such as: what makes taxation such a difficult issue? Why do people feel cheated when it comes to tax? Is government making judicious use of taxpayer’s money? In view of these questions above, this study is going to be carried out to offer solution to them. We shall also look at the following issues and offer recommendations. 1. Problems affecting the successful operation of tax system in Nigeria. 2. How to determine the Assessable income. 3. Process of tax administration in Nigeria.

1.3 OBJECTIVE OF THE STUDY: The general objective of the study is to assess the contribution of taxes towards the growth of the Enugu State Economy. However, the specific objective of the study includes: 1. To examine the relevance of taxation in Enugu State. 2. To determine why people feel cheated when it comes to tax. 3. To determine the extent government has been using revenue generated from tax. 4. To examine how tax rate affects the rate of investment in the economy. 5. To know general desirability of firms to invest as a result of tax incentive measures. Generally, the work is done to find out if tax constitutes the bulk of government revenue and to erase the erroneous that it is an exploitation by government for their selfish interest.

1.4 SIGNIFICANCE OF THE STUDY: One of the most frequently discussed issues in Nigeria is how to solve the economic hardship in the country and how to create an industrial base that can be guarantee self sustaining economic development. Also one wonders why a country which is richly endowed with the necessary human and material resources and which the people pay tax has been turned a heavily indebted country. The study will afford us the opportunity to know the roles taxation play in the Enugu State economy such roles includes: 1. Taxation is a major source of revenue to the government. 2. Revenue generated from tax enables government performs its functions effectively. 3. Taxation acts as an instrument of fiscal policy. 4. The impact of tax on small business in the state. 5. The study will in addition reveal if there are other better sources of government funding.

1.5.1 SCOPE OF THE STUDY: The scope of this study covers critical examinations on the impact of taxation on Enugu State economic development. It will also analyse other related issues such as structure and administrative machinery of tax in Enugu State and their associated problems. The essence of this digression is to possibly find out the obstacles if any, that hinder the effective collection and administration of tax in the State.

1.5.2 LIMITATION OF THE STUDY: It can be seen from all indications that a research such as this cannot be carried out in one semester. There are constraints that limit the work of the researcher. Among these are: - Inadequate Time: The time available is very limited, as a result of this, the researcher is restricted to some places for interviews and questioning during the collection of data. - Insufficient Fund: The funds available to the researcher is not sufficient to carry out this research work. As a result of high economic hardship as well as high cost of transportation. - The inability of some government officials to disclose certain reliable information which they considered confidential may also limit the study. - There is also scarcity of current textbooks on tax because tax laws are constantly changed and so many textbooks are obsolete for this topic. Finally, the academic workload on the campus is one of the limiting factors on this research work. Despite all these constraints, the researcher is able to carry out a fair and effective study on this topic.

1.6 ASSUMPTIONS OF THE STUDY: The researcher in carrying out this study will make the following assumptions: 1. That the data that will be used are true and fair figures of taxes actually collected by the Federal Government in each year of assessment. 2. That the data will be authentic and can be relied on for further research work on the topic. 3. That the data is going to form the basis of the research work.

1.7 FORMULATION OF HYPOTHESIS: To enable the researcher test if there exist any correlation between revenue generated from tax and its impact on the Enugu State economy, some statistical model will be used based on the response from the oral interview carried out and the questionnaire distributed, the data gathered from here will be used to test the following hypothetical statement (assumption). HYPOTHESIS I: The Null Hypothesis (Ho): Revenue generated from tax does not make any impact on the economic development of Enugu State The Alternative Hypothesis (HA): Revenue generated from tax has a positive impact on the economic development of Enugu State. HYPOTHESIS II: The Null Hypothesis (HO): That tax evasion and avoidance do not affect tax revenue. The Alternative Hypothesis (HA): that tax evasion and avoidance do affect tax revenue. HYPOTHESIS III: The Null Hypothesis (HO): That revenue generated from tax is so merger compared to revenue from other sources as such, government can do with tax. The Alternative Hypothesis (HA): That tax is a major source of government revenue and as such government cannot do without tax.

1.8 DEFINITION OF TERMS: TAX: A compulsory levy by the government on its citizen for the provision of public goods and services. TAX BASE: The object which is taxed for instance personal income, company profit. TAX RATE: The rate at which tax is charged. TAX INCIDENCE: It offers to the effect of and where the burden is finally rested. FBIRS: Federal Board of Inland Revenue Services. It is an operational arm of Federal Board of Inland Revenue which is responsible for the Federal Tax matters. CITA: Company Income Tax Act (CITA) is a federal law operated by the FIRS, which deals with the taxation of all limited liability companies in Nigeria with the exception of those engaged in petroleum operations. JTB: Joint Tax Board (JTB) is established under Section 85(1) of Decree 104 of 1993 to arbitrate on tax disputes between one state tax authority and another. VAT: Value Added Tax is a multistage tax levied and collected on transactions at all stages of sales and distribution. CGTA: Capital Gain Tax Act is an act that stipulates that all capital gains arising on disposal of asset of individual partnership and limited companies should be taxed. PPTA: Petroleum Profit Tax Act is an act that regulates the petroleum profit tax and also specifies how profit from petroleum will be taxed. WITHHOLDING TAX: This is tax charged on investment income namely: rents, interest, royalties and dividends, presently it is charged as the tax offset. PROGRESSIVE TAX: This is a tax incidence that increases as the size of income increases. REGRESSIVE TAX: A tax is regressive when its tax rate decreases as the income increases. EXCISE DUTIES: These are taxes on some goods manufactured within a country. PERSONS: It includes all taxable persons whether it be individual or corporate bodies.  

REFERENCES 1. A. K. Ageyi (1985) Economic Development for West Africa, First Edition. 2. J. E. Ove (1968) Taxation and Economic Development in Tropical Africa. 3. W. U. Ani (2004) Companies Income Tax in Nigeria: An Instructional Approach Revised Ed.