Socio-Economic Effects of Tax Administration and Revenue Generation in Kwara State: An Assessment of Kwara Internal Revenue Service (KW-IRS)

Abstract

The decline in price of oil in recent years has led to a decrease in the funds available for distribution to the Federal, State and Local Governments in Nigeria. Consequently, the need for state and local governments to generate adequate revenue from internal sources. This need underlines the eagerness on the part of state and local governments and even the federal government to reform tax policy and harness new sources of revenue. This has been the trend of tax administration in virtually all state across Nigeria including Kwara State. Against this backdrop, this study examined the socio-economic effects of tax administration and revenue generation of KW-IRS in the state. The study adopted questionnaire and interview as means of data collection. The study relied on a total sample of 167 respondents selected using multiple sampling techniques from government ministries, public health centres, public schools and public shop owners in Ilorin metropolis. From the findings, the study revealed that a sizable number of the respondents viewed the present KWIRS tax administration very effective in revenue generation. Also, the study finds that there is a significant relationship between effective tax administration and socio-economic development of the state in the areas of improved health care system (X2=9.345, P<0.05); education facility (X2=14.324, P<0.05) and employment generation (X2=12.480, P<0.05). However, majority of the respondents hold the perception that KW-IRS and the government are not doing enough to enlighten the public about their activities and developmental programmes.