What are the problems of taxation in Nigeria?
Nigeria tax system is confronted with many issues and challenges such as multiplicity of taxes, bad administration, non-availability of database, tax touting, complex nature of the Nigerian tax laws, minimum tax, commencement, change of accounting date and cessation, and non-payment of tax refunds.
What are the problems faced by tax authorities?
It was found out from 82% of the respondents that the challenges faced by tax authorities during domestic revenue mobilization in URA include; taxpayer compliance burden, lack of adequate resources to sustain and facilitate the operation of tax authorities, lack of modern technology, high levels of illiteracy and the …
What was the impact of imposing tax?
Imposition of taxes results in the reduction of disposable income of the taxpayers. This will reduce their expenditure on necessaries which are required to be consumed for the sake of improving efficiency. As efficiency suffers ability to work declines. This ultimately adversely affects savings and investment.
What is the problem with high taxes?
High marginal tax rates can discourage work, saving, investment, and innovation, while specific tax preferences can affect the allocation of economic resources. But tax cuts can also slow long-run economic growth by increasing deficits.
What are the disadvantages of taxes?
Disadvantages of Paying Taxes
- People have less money to spend.
- Less overall savings in bank accounts.
- Investments for the future might suffer.
- Taxes may discourage people to work hard.
- People may try to avoid tax payments.
- Tax schemes may be considered to be unfair.
- Big corporations often try to avoid paying taxes.
What tax affects the poor the most?
In contrast, the average payroll tax rate for households in the lowest income quintile is 6.9 percent (the same as the 6.9 percent average rate for all households). The payroll tax is by far the most significant federal tax for households in the lowest income quintile, in terms of how much they pay.
What are the negatives of taxes?
High taxes may inhibit economic growth, and the government sometimes institutes tax cuts during periods of economic hardship to encourage spending and growth. Opponents of taxation may also argue that taxes act as a disincentive to work, since they reduce the direct financial reward of earning income.
What are the disadvantages of direct tax?
Demerits of direct taxation are: 1. Pinching 2. Inconvenient 3. Evasion and Corruption 4.
What is the problem with lowering taxes?
Advocates of tax cuts argue that reducing taxes improves the economy by boosting spending. Those who oppose them say that tax cuts only help the rich because it can lead to a reduction in government services upon which lower-earning individuals rely.
How bad is not paying taxes?
If you still refrain from paying, the IRS obtains a legal claim to your property and assets (“lien”) and, after that, can even seize that property or garnish your wages (“levy”). In the most serious cases, you can even go to jail for up to five years for committing tax evasion.